A pending securities lawsuit regarding the regulatory status of the XRP token was requested to be removed last week by Ripple Labs legal team. The legal representatives of Ripple said that the class action suit against them was filed by a group of investors that have no geographical limitations. Therefore, the matter should not be addressed by a state court.
XRP (XRP) Price Today – XRP / USD
Flom litigation partner Peter Morrison, Skadden, Slate, Arps, and Meagher argued that the amount of the suit exceeded $5 million and was filed in agreement of over 100 people giving Ripple Labs the power to take the lawsuit to a federal court. The argument was as follows:
“A putative class action can be removed from a state court to a federal district court if the following requirements are met: (1) the action is a class action lawsuit on behalf of one hundred members or more, (2) the plaintiff is not a citizen of the same state of the defendant. (3) the amount under controversy is more than $5 million.
Expert Says Ripple’s Legal Team Is Making A Smart Move
A government securities litigation and enforcement defense attorney at Kobre & Kim, explained that the move of Ripple’s legal team to remove the securities lawsuit involving the XRP token to a federal court is brilliant. Chervinsky, citing the report said:
“The Ripple Labs legal team has displayed tactical brilliance here. It’s difficult explain this smart move in one tweet and I don’t want to do a thread on this issue. However, all I can say is that it is a smart move to push the matter to a federal court. Even if it might not work, it’s still strategic”.
According to Chervinsky, the class action lawsuit will still be regarded as a nationwide class action lawsuit even if it remains in the state court. He said that the legal team of Ripple Labs will have to justify the relocation before the lawsuit can be moved from a state court to a federal court. He continued:
“The state court has jurisdiction over the state residents and residents of other states. This is why there is nothing wrong with a nationwide class action lawsuit being resolved in a state court. Additionally, the 1933 Securities Act gives the federal and state courts concurrent jurisdiction over all private civil claims”.
What this means is that even if the lawsuit against XRP is a nationwide class action lawsuit, the state court has full jurisdiction to handle the matter. If Ripple’s request is to be granted, it’s legal team must prove that only a federal court has the power to handle the case. This is why he believes the removal request will not be granted.
The regulatory uncertainty surrounding XRP has hindered the token from reaching its peak. Many exchanges like Coinbase have listed coins with small market capitalizations but have refused to list XRP because of these regulatory uncertainty. A few months ago, the United States Securities and Exchange Commission announced that Bitcoin and Ethereum are not securities. However, they didn’t say anything about XRP.
XRP (XRP) Price Analysis
At the time of writing, XRP was unchanged against the USD trading at $0.504758. Against Bitcoin, however, it was trading 0.27% lower. The 24 hour trading volume is $319,209,970 and the market capitalization is $20,294,064,818.