Runlayer, Rippling drop lawsuits — but the brouhaha is still a cautionary tale for founders

On Wednesday night, Runlayer and Rippling dropped their respective lawsuits against each other. No settlement was made. No money changed hands. Not even lawyers’ fees, according to court documents seen by TechCrunch.

Rippling celebrated by instantly releasing its MCP gateway, the product at the heart of the dueling lawsuits and the one that competes with Runlayer’s offering.

This public fight is a cautionary tale to founders: In the age of AI, when building new software has become almost trivial, you never know who your next competitor will be. It might even be a prospective customer.

To recap the short-lived legal brouhaha: Runlayer is an early-stage startup that launched out of stealth in November, 2025 and has raised a total of $42 million from VCs like Khosla Ventures’ Keith Rabois and Felicis. It’s led by third-time founder Andrew Berman (previous companies: baby-monitor maker Nanit and an AI video conferencing tool, Vowel, that sold to Zapier in 2024).

After Rippling tested Runlayer’s MCP gateway for more than a year, with the two engineering teams working closely together, Rippling never signed on to become a customer, according to Runlayer’s lawsuit. Instead, Berman received a text from a Rippling employee that said his employer was building its own MCP gateway and planned to release it as a product. This employee described Rippling’s product as a clone of Runlayer’s.