Blockchain firms R3 and Ripple locked in legal tussle
Niggle between R3 and Ripple
The blockchain duo of R3 and Ripple are suing each other over an options contract to purchase Ripple’s digital currency XRP, according to Reuters.
In September 2016, the two companies entered an agreement giving R3 the right to purchase up to five billion XRPs for $0.0085 per unit until September 2019, according to a lawsuit filed by R3 in the Delaware Chancery Court in the US.
In June 2017 Ripple’s chief executive Brad Garlinghouse attempted to terminate the options contract through an email to R3’s chief executive David Rutter, according to the R3 lawsuit.
Reuters says that R3 alleges that the contract does not give Ripple the right to terminate it unilaterally and is asking the court to declare that it is entitled to all its rights, including purchasing the XRP anytime over the next two years.
As is common in legal fights, Ripple responded by filing its own lawsuit against R3 in a California state court in San Francisco.
Ripple’s lawsuit alleges that the company terminated its agreement because R3 had failed to deliver on another parallel technology partnership agreement to give Ripple access to its network of banks and help promote its technology, explains Reuters. It asks the court to declare that the agreements are invalid and order R3 to pay damages in an amount to be determined at trial.
XRP, which is traded against the US dollar on online cryptocurrency exchanges, has increased dramatically in value, and so this would make the option contract worth more than $1 billion.
“Our filing is straightforward – R3 misrepresented their ability and intent to deliver on their commitments,” Ripple says in a statement. “Given XRP’s 4,000% increase over the course of the year, R3 suddenly wants to tap into the value of XRP, though the facts are clear that they did not earn any option based on our agreement.”
As reported by Banking Technology at various times, the value of cryptocurrencies such as XRP and Bitcoin continues have been rising and gaining a lot of interest.
Main attractions
Away from lawsuits, both companies have been active.
R3 has had a busy year so far with its Corda platform. Some recent developments include R3, CGI and 11 banks unveiling a prototype of a trade finance app; working with Intel to beef up its data privacy and security; and the creation of a prototype solution for issuance of euro commercial paper (ECP).
Not to be outdone, Ripple welcomed ten more financial institutions to its blockchain network for cross-border payments; teamed with the Bank of England’s fintech accelerator; and got some love from the National Bank of Abu Dhabi (NBAD).
If you’d like more information, then you could consider this “boringly good guide to cryptocurrencies”, courtesy of credit card specialist MBNA; and an opinion piece on “Digital currency: the future or the biggest flop?”.
