On Tuesday, a Florida judge dismissed a lawsuit against Deel, an HR and payroll provider currently facing legal difficulties.
Deel characterized this litigation as “Rippling-aligned” and “Rippling-supported.” However, it is not the infamous lawsuit filed by its rival earlier this year, which involved an alleged corporate spy.
In a tweet, Rippling CEO Parker Conrad went so far as to state, “This litigation has nothing to do with Rippling. We are not a party to it and did not fund it.” (Rippling representatives declined to provide additional commentary.)
Nevertheless, this is some positive news for Deel. Melanie Damian filed a lawsuit in Florida in January, accusing Deel of facilitating the circumvention of U.S. sanctions by processing remittances for Surge Capital Ventures on behalf of Russian entities.
A distinct U.S. SEC action had been filed against Surge, alleging that the company was involved in a Ponzi scheme that defrauded church members of $35 million.
At the time, Semafor reported that Damian, a court-appointed receiver for Surge, was responsible for the recovery of assets. She filed the lawsuit on behalf of investors, asserting that Deel was accountable for the payment processing. This is the case that was dismissed.
Deel attempts to connect this case to the Rippling lawsuit, partly because Damian’s attorneys referenced the Racketeer Influenced and Corrupt Organizations Act (RICO).
Rippling, which is currently prosecuting Deel in California, also asserts that Deel violated the Defend Trade Secrets Act, California state law, and RICO, as previously reported by TechCrunch. The RICO statute is renowned for its initial application in prosecuting organized crime.
Nevertheless, Rippling’s lawsuit pertains to a distinct set of allegations focused on a Rippling employee who testified in an Irish court that he had been serving as a paid corporate informant for Deel.
Deel anticipates that if one court dismisses a lawsuit alleging RICO violations, another court will do the same. “The ruling raises additional concerns regarding the credibility of Rippling’s latest set of baseless RICO allegations in California,” a Deel spokesperson stated in an email to TechCrunch.
However, because these cases involve distinct actions and circumstances, it will be necessary for all parties to await the California court’s response. In the interim, Deel is also pursuing legal action against Rippling, asserting that one of its employees was unlawfully impersonating a customer.
In addition, Keith O’Brien, the individual who admitted to being Deel’s purported corporate spy, successfully obtained a restraining order against individuals he claimed were stalking him and causing anxiety for his family. The main witness in Rippling’s case against Deel is now O’Brien.
Initially, Deel’s attorneys denied involvement; however, they acknowledged that the company had employed “discreet surveillance” of O’Brien, as per court testimony obtained by TechCrunch and initially reported by the Irish Independent.
“Alex and his father can deflect and delay, but they will be held accountable when we have our day in court,” Conrad stated in his tweet, alluding to Rippling’s lawsuit that implicates Deel’s founder and CEO, Alex Bouaziz, and his father, Philippe Bouaziz, who serves as chairman and chief financial officer.
In that statement, a Deel spokesperson stated, “Deel will continue to concentrate on achieving success in the marketplace, vigorously defend itself against pending cases, and explore all available options for relief.”
