Deel Wins Lawsuit - But Not Against Rippling

Lawsuit Against Deel Dismissed in Florida

A lawsuit targeting HR and payroll company Deel was recently dismissed by a Florida judge. Deel characterized the legal action as being connected to, and potentially supported by, its competitor, Rippling.

However, this dismissal is distinct from the earlier lawsuit initiated by Rippling this year, which centered around allegations of corporate espionage.

Rippling's Response

Parker Conrad, CEO of Rippling, stated via Twitter that his company had no involvement in the Florida lawsuit, clarifying they were not a party to it and did not provide funding. Rippling representatives declined to offer any additional commentary.

Details of the Dismissed Lawsuit

The dismissed case was originally filed in January by Melanie Damian. Damian accused Deel of facilitating transactions for Surge Capital Ventures, potentially enabling these entities to circumvent U.S. sanctions.

Surge Capital Ventures was previously the subject of a separate action by the U.S. Securities and Exchange Commission (SEC). The SEC alleged the company operated a Ponzi scheme, defrauding church members of $35 million.

Damian, appointed as a receiver for Surge, was responsible for asset recovery and brought the lawsuit on behalf of investors, asserting Deel’s responsibility for processing the payments in question.

Connection to the Rippling Lawsuit

Deel is attempting to draw a parallel between this dismissed case and the ongoing lawsuit filed by Rippling. This connection stems from the fact that Damian’s legal team invoked the Racketeer Influenced and Corrupt Organizations Act (RICO).

Rippling’s lawsuit in California also alleges RICO violations, alongside claims of violations of the Defend Trade Secrets Act and California state laws. The RICO statute is historically known for its use in prosecuting organized crime.

Allegations in the Rippling Suit

The core of Rippling’s lawsuit revolves around accusations that Deel engaged in corporate espionage. A Rippling employee testified in an Irish court that he was employed as a paid informant by Deel.

Deel's Hopes for Dismissal

Deel is expressing hope that the dismissal of the Florida lawsuit will influence the outcome of the California case. A Deel spokesperson suggested the ruling raises doubts about the validity of Rippling’s RICO accusations.

However, given the distinct nature of the actions and circumstances involved, the California court’s response remains to be seen.

Counterclaims and Further Legal Actions

Simultaneously, Deel is pursuing legal action against Rippling, alleging that a Rippling employee misrepresented themselves as a customer.

Keith O’Brien, the individual who admitted to acting as Deel’s alleged corporate spy, has obtained a restraining order against individuals he claims were harassing his family and engaging in surveillance.

O’Brien is now a key witness for Rippling in its case against Deel. Initially, Deel’s legal representatives denied any involvement, but later acknowledged the company had authorized “discreet surveillance” of O’Brien.

Further Statements from Key Figures

Parker Conrad reiterated his stance on Twitter, stating that Alex and Philippe Bouaziz, Deel’s founder and CEO and his father (who serves as chairman and CFO), “will face the music” in court.

Deel’s spokesperson affirmed the company’s intention to explore all available legal options, vigorously defend itself against pending lawsuits, and maintain its focus on market success.

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