An ongoing legal battle between XRP investors and payments startup Ripple is entering its next phase.

Attorneys for Ripple Labs and its affiliated defendants filed to move a consolidated class-action lawsuit from its previous venue at the San Mateo Superior Court to the U.S. District Court, Northern District of California, according to court documents published Wednesday.

The defendants argued that the consolidated suit matches the requirements for a case to be brought before the higher, federal court.

In addition to the request to change the venue, Ripple’s attorneys hinted at the company’s defense against the suit, which alleges that the XRP token is a security issued by Ripple. As part of the removal process, they wrote:

“Plaintiffs do not allege that they lacked information about the nature of these transactions. Nevertheless, Plaintiffs claim that they were somehow injured because the Defendants were allegedly required to register XRP as a ‘security’ with the Securities & Exchange Commission (‘SEC’) but failed to do so.”

The consolidated class action combines previous class-action lawsuits filed by plaintiffs Avner Greenwald, David Oconer and Vladi Zakinov, according to the document. A fourth suit filed by Ryan Coffey was voluntarily dismissed by the plaintiff in August, though Ripple’s attorneys later filed to have it related to Zakinov’s suit.

The defendants now include Ripple Labs and its subsidiary XRP II, as well as Bradley Garlinghouse, Christian Larsen, Ron Will, Antoinette O’Gorman, Eric van Miltenburg, Susan Athey, Zoe Cruz, Ken Kurson, Ben Lawsky, Anja Manuel and Takashi Okita.

Why the move?

Ripple’s attorneys argue that, under the U.S. Class Action Fairness Act (CAFA), the case can now be shifted to federal court. Specifically, they cite the fact that there are more than 100 members of the suing class, at least one plaintiff is a citizen of a different state than the defendants and the total amount being sued for exceeds $5 million.

One of the lawsuits, originally brought by Israeli resident Avner Greenwald, states that there are “thousands” of individuals who lost money after buying XRP. The plaintiffs are also asking for Ripple to pay $167.7 million in damages.

Simply the act of seeking to move the case to district court means the case is now before that federal court, said Stephen Palley, a partner at the D.C.-based law firm Anderson Kill.

Palley told CoinDesk that plaintiffs can try to move the case back before a state-level court by filing a motion to remand. And indeed, a subsequent filing entered on Thursday indicates that the plaintiffs will file a motion to remand the case back to the San Mateo Superior Court.

As such, the next deadline for Ripple to respond to the complaint itself will either be two weeks from the date the motion to remand is denied (if it is denied) or two weeks from when the San Mateo court receives the case (if the motion to remand is approved).

Speaking about class-action lawsuits in general, Palley explained that “the conventional wisdom is that state court juries and judges tend to be more sympathetic to plaintiffs,” possibly in part because state-level courts will draw from a more local jury pool.

“There’s also a perception that sometimes a state court judge … may be more political,” he said, noting that some state-level judges are elected.

“Defendants, on the other hand, have a perception that they’ll get a more fair shake in federal court.”

Read the full Notice of Removal here:

Ripple Consolidation Remova… by on Scribd

Justice statue image via Shutterstock