Deel Sues Rippling for Defamation, Escalates Silicon Valley Feud

Deel Inc., a $12 billion Silicon Valley startup, is escalating a bitter legal fight with its top rival in the market for human resources and payroll software.

The company has filed a defamation lawsuit in Delaware state court against People Center Inc.’s Rippling for allegedly spreading lies about Deel to undermine its business. Rippling accused Deel last month in a separate suit in California of corporate espionage and misappropriation of trade secrets. Deel on Friday asked a federal judge to dismiss that case.

According to the Delaware suit, Rippling pressured an employee to tell the court a distorted and “implausible” story about Deel cultivating him as a spy to steal trade secrets, and that the employee was actually a whistleblower who had raised concerns about Rippling’s accounting and business practices.

Rippling also allegedly solicited Deel workers for confidential information and placed “an insider” at the company to “eavesdrop on Deel’s internal communications without Deel’s permission,” according to the Delaware complaint, which was filed Thursday.

In a post Friday on X, Rippling Chief Executive Officer Parker Conrad wrote, “Deel filed their response to Rippling today. In hundreds of pages filings, what stands out is what’s missing.” Deel did not, Conrad said, directly refute Rippling’s central claim that it paid an employee to steal Rippling trade secrets. A representative for Rippling didn’t provide a comment beyond the CEO’s social media post.

Conrad isn’t a defendant in the defamation lawsuit. But it alleges he has a personal vendetta against Deel and its largest investor, Andreessen Horowitz, the venture capital firm that played a role in the 2016 ousting of Conrad from Zenefits, another HR software company he co-founded. Andreessen has a more than 20% stake in Deel.

At the time of Conrad’s departure, Zenefits was accused of skirting regulations and ended up paying fines and settling with the U.S. Securities and Exchange Commission. Neither the company nor Conrad admitted wrongdoing in the settlement.

Rippling and Deel have been fierce competitors as they raised hundreds of millions of dollars from investors, giving each sky-high valuations. Their rivalry became a Silicon Valley spectacle after Rippling’s lawsuit alleged one of its employees had been secretly paid by Deel to gather intelligence on the company.

The employee, who was based in Dublin, stated in an earlier affidavit filed with Ireland’s High Court that he communicated covertly with Deel’s co-founder between September 2024 and March, disclosing Rippling’s corporate strategy and sales leads, and falsifying whistleblower concerns about Rippling at Deel’s behest.

Deel claimed in its suit that the affidavit was filed while the employee was under “extreme duress” and is “replete with falsehoods.”

The cases are Deel v. People Center, N25C-04-239, Superior Court of the State of Delaware; People Center v. Deel, 25-cv-2576, US District Court, Northern District of California (San Francisco).