Lawsuit filed against Coinbase over XRP token sales alleging unfair competition

A Coinbase customer filed suit in the United States District Court for the Northern District of California, accusing the exchange of violating state unfair competition laws by taking commissions from the sale of XRP tokens.

According to the plaintiff, Thomas Sandoval, Coinbase profited from trading XRP, knowing the token was an unregistered security. The exchange team had enough information to do so, Sandoval asserts.

Last week the United States Securities and Exchange Commission (SEC) filed suit against Ripple. The regulator claims that the California-based fintech company sold unregistered securities in the form of XRP for seven years.

“Coinbase sold the XRP token, the value of which was entirely tied to the success or failure of Ripple Labs that created it and the managerial efforts of the company’s executives. Investors in XRP, such as the plaintiff, were hoping to profit from those efforts by Ripple’s leadership and bought the token to earn from their investments,” said Sandoval.

He expects other Coinbase customers to join the suit, and for him to obtain class-action status.

The plaintiff seeks an unspecified amount of damages from Coinbase, as well as payment of legal fees and other litigation costs.

489463141-cb-suit by ForkLog on Scribd

Coinbase had already announced a pause in trading of XRP for users in all supported jurisdictions.

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