Ripple Investor Sues to Force Stock Redemption After SEC Claim

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Photographer: Akos Stiller/Bloomberg

Ripple Labs Inc., whose XRP token is the world’s third-largest cryptocurrency, was sued by a U.K. investment company after the U.S. Securities and Exchange Commission claimed the virtual tokens were sold improperly.

Tetragon Financial Group Ltd., with total assets of $2.32 billion, filed the complaint under seal Monday night in Delaware Chancery Court. In concurrent filings that are public, the investment company said it seeks to “enforce its contractual right to require Ripple to redeem” Series C preferred stock held by Tetragon and to block Ripple from using any cash or other liquid assets until the payment is made.

Tetragon also asked the court for a temporary restraining order, a preliminary injunction and an expedited trial. Its briefs in support of the requests also are sealed.

Representatives of Ripple and of Tetragon didn’t immediately respond to requests for comment.