Ripple and R3 reach settlement in year-long litigation
Both parties look forward to putting the incident behind them and keeping all the juicy details secret.
The ongoing litigation struggle between Ripple and R3 dates back to September 2017, with the background of the case giving a brief glimpse at the networking and backroom-heavy modus operandi of big banks.
According to a recent press release, Ripple and R3 have reached a settlement in all outstanding litigation.
"The terms of the agreement will remain confidential and both sides look forward to putting these disputes behind them," the release says.
The lawsuit revolves around a previous deal where Ripple offered R3 five billion XRP for less than a penny each. In return, R3 would help Ripple connect with key banks which might have included Goldman Sachs, JP Morgan and Morgan Stanley, all of whom were part of the R3 consortium at the time the deal was inked.
R3 says Ripple failed to deliver the funds, which might have left R3's lawyers feeling a little put out at Ripple.
In turn, Ripple argues that R3 entered into the contract in bad faith, using it as a cover to steal some of Ripple's experience in order to develop a competing product, all while R3 "knew and had reason to know that several key banks that would be instrumental to Ripple's success would soon be departing from its consortium."
Ripple's counterargument might square with input from anonymous R3 insiders, who supposedly spoke to Fortune about the state of the company, describing it as something like a company of bankers without a bank that was formed in 2014 to let banks dip their toes into blockchain in the company of familiar faces and was then left behind when technology moved on and lost key members when a lack of exclusivity saw membership in the R3 consortium look less attractive.
It might be worth looking at the terms of that deal to highlight the staggering price Ripple was willing to pay for introductions to the right banks.
It's not clear when the discussion between Ripple and R3 kicked off, but by the time the lawsuit kicked off, XRP had been consistently trading above 20 cents, according to Live Coin Watch. And it was trading above the deal price of approximately 1 cent since March 2017. At current prices, those 5 billion XRP are worth well over US$1 billion.
The right introductions are clearly worth a lot. Although it seems like a high price to pay for the opportunity to pitch someone an idea that can save them a lot of money and hassle as Ripple aims to do in international payments.
Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VET, XLM, BTC and ADA.