The saga continues as Ripple files fresh countersuit against R3
Ripple countersues R3 over $12 million XRP Options contract.
The R3-Ripple saga takes a new twist as Ripple files a countersuit accusing the bank consortium of signing the deal in question in bad faith and stealing expertise to formulate a rival product.
In the original suit, R3 accused Ripple of unilaterally terminating a contract that gave it the right to buy five billion of its XRP tokens at $0.0085 each.
The 2016 deal
The deal was struck in September 2016 and should have been valid until September 2019. But in June 2017, the then Ripple CEO, Brad Garlinghouse, made an attempt to terminate the contract. R3 then moved to court to challenge the move insisting on its right to make the purchase any time before the stipulated date.
In Ripple’s response lawsuit, it alleged that R3 had in fact invalidated the contract as it failed to deliver its end of the bargain. The latest countersuit explains in detail why Ripple should not have to honour the contract terms.
It explains in part that R3 did not assist Ripple to sign up even one single bank. It goes on to say that at the time, the R3 CEO, David Rutter, was aware that some big players like JPMorgan Chase, Goldman Sachs and Morgan Stanley had intentions of leaving its consortium but that he failed to share the information with Ripple.
The suit also explains that this was a misrepresentation of the consortium’s resources and capacity to assist Ripple to reach its objectives. It goes further to quote emails from Rutter in a bid to demonstrate his disinterest in the project when the Ripple team most needed support.
It would be particularly difficult to predict the possible outcome of this instrumental case. A contract law expert suggests that the outcome depends on Ripple’s ability to prove the extent of the alleged breach and its impact on the company’s performance.
This comes at a time when Ripple is having a particularly good run. Barely a week ago, Ripple set a new all-time high of $3.50 thanks to speculations surrounding its ecosystem. Even though prices are back down to slightly below $2, this still places the value of the contract in question at more than $12 billion.
R3, on the other hand, has launched its own blockchain-based software referred to as Corda that provides a trade finance app.