Deel loses bid to block witness in Rippling spy case

Deel’s legal strategy faced another setback in the ongoing dispute with Rippling, as a federal judge rejected the company’s attempt to silence a key witness. The ruling underscores the intensifying litigation between the two tech firms, which center on allegations of corporate espionage and competitive malice.

The conflict intensified after Deel filed a motion in July seeking to prevent former employee O’Brien from testifying. O’Brien had previously refused to respond to over 100 questions and document requests from Deel, invoking his Fifth Amendment right against self-incrimination. However, Judge Breyer found this procedural maneuver improper. According to reports from Bloomberg, the judge determined that Deel had failed to make genuine efforts to resolve the underlying dispute. Furthermore, the court noted that O’Brien’s legal counsel had explicitly assured the court that he would not rely on the Fifth Amendment during testimony, a safeguard that Deel seemingly ignored.

Beyond the witness issue, the judge addressed several substantive claims brought by Deel. Deel had argued that Rippling coerced O’Brien into fabricating a narrative, positioning him instead as a whistleblower who exposed irregularities in Rippling’s business operations. Rippling has consistently denied these accusations. In a significant blow to Deel’s case, the court also dismissed claims related to cybersquatting and trademark infringement. These specific allegations involved the domain name deal.com, which Rippling allegedly utilized to redirect traffic to its own website.

Despite these dismissals, the litigation is not entirely over for Deel. Judge Breyer allowed the company to proceed with portions of its 32 claims under the Lanham Act, the federal statute governing false advertising. Deel alleged that Rippling misled its clients through deceptive marketing practices. While the judge did not validate the truth of these assertions at this stage, he permitted Deel to revise and refile the dismissed claims, keeping those specific avenues of the lawsuit alive.

The decision prompted an immediate reaction from Rippling, which viewed the ruling as vindication. “Deel’s efforts to avoid facing justice continue to collapse,” the company stated in a public release. As of the latest update, Deel had not provided comment to Bloomberg regarding the judge’s order. The broader legal battle, formally known as People Center Inc. v. Deel Inc., remains active in the US District Court for the Northern District of California. People Center serves as the legal entity name for Rippling within this jurisdiction.