HR software company Rippling sued competitor Deel on Monday, alleging it engaged in a “corporate espionage scheme.” Deel has disputed the claims.
Rippling alleged Deel aimed to steal sensitive business information and trade secrets in a brazen and systematic manner — by cultivating a “spy” within Rippling.
The employee used Rippling systems to spy on Deel customers who were discussing a switch away from Deel, the lawsuit said; he also allegedly accessed other employees’ personal information so Deel could attempt to poach key personnel.
Following a variety of leaks, Rippling said it staged a “honeypot” test to attract the mole earlier this month: It informed two members of Deel’s senior leadership team and its outside counsel that Rippling employees were discussing information about Deel that would be embarrassing if made public and that they were doing so in a Slack channel called “d-defectors.”
Within hours, the mole had searched for and accessed the decoy channel; this, according to Rippling, proved “beyond any doubt that Deel’s top leadership, or someone acting on their behalf, had fed the information on the #d-defectors channel to Deel’s spy inside Rippling.”
Rippling last week obtained a court order in Ireland, where the alleged mole resides, to ensure that information on his phone would be preserved. Upon being served, however, the individual allegedly lied about the location of his phone and locked himself in a bathroom “seemingly to delete evidence from his phone,” Rippling said in the subsequent U.S. lawsuit.
The complaint said Rippling is aiming to stop the misuse of its confidential information and obtain compensation for the alleged harm Deel caused, among other things.
A Deel spokesperson told HR Dive via email that Rippling is “seeding falsehoods,” trying to shift the narrative with sensationalized claims after Rippling was accused of violating “sanctions law in Russia.”
“We deny all legal wrongdoing and look forward to asserting our counterclaims,” the spokesperson said.
