Rippling and Runlayer Locked in Dueling IP Lawsuits
AI-generated image · US National Wire
The HR startup and MCP gateway provider are trading accusations of patent infringement and trade secret theft following a failed commercial trial.
HR startup Rippling and MCP gateway startup Runlayer are currently engaged in a legal battle centered on intellectual property and breach of contract, as first reported by TechCrunch. According to that reporting, the conflict began last month when Runlayer sued Rippling, alleging that the HR firm stole its product ideas and breached a contract.
The dispute follows a period of nearly one year during which Rippling trialed Runlayer's MCP product. MCP is an open standard designed to enable AI agents to connect with the software systems and data required for independent operation. Runlayer, founded by Andrew Berman—who previously founded Nanit and Vowel (sold to Zapier in 2024)—has raised $42 million to date. Its product combines an MCP gateway with cybersecurity capabilities, including threat detection.
TechCrunch reports that the two companies never reached an agreement on pricing, and the trial did not result in a paid contract. Subsequently, Rippling developed its own MCP server, which it intends to market as a competing product. This follows a pattern for Rippling, which frequently commercializes internal tools, such as its AI Spend Console.
In a new filing on Monday, Rippling counter-sued Runlayer, accusing the startup of infringing on three of its patents. A Rippling spokesperson told TechCrunch that Runlayer has "manufactured claims" to mask "business failures" while repeatedly copying Rippling's inventions.
Conversely, Runlayer maintains that Rippling's lawsuit is a "retaliatory ploy" intended to distract from the misappropriation of proprietary technology. Founder Andrew Berman stated that Runlayer's AI product is distinct from the patents cited by Rippling. One notable claim in Runlayer's original suit is that a Rippling employee warned Berman that the company was building a copy of Runlayer's product; a Rippling spokesperson told TechCrunch that the employee has since revised that opinion.
TechCrunch notes that Rippling informed Runlayer of the alleged patent infringements shortly after the startup's initial lawsuit, suggesting the move may be intended as leverage for a settlement.