Runlayer and Rippling have dropped their lawsuits against each other without reaching a settlement or exchanging money, according to court documents reviewed by TechCrunch. Shortly after the cases were dismissed on Wednesday night, Rippling released the MCP gateway that had been central to the dispute.
The legal fight began after Runlayer alleged that Rippling tested its MCP gateway for more than a year, worked closely with its engineering team, and then developed a competing product rather than becoming a customer. Rippling later countersued Runlayer over alleged patent infringement.
The Dispute Centered on Competing MCP Gateways
Runlayer emerged from stealth in November 2025 and has raised $42 million from investors including Khosla Ventures’ Keith Rabois and Felicis. The startup is led by Andrew Berman, who previously co-founded Nanit and Vowel.
According to Runlayer’s lawsuit, Rippling spent more than a year testing its gateway before an employee told Berman that the company was building its own version. Runlayer alleged that Rippling violated contractual agreements covering those product evaluations.
Rippling responded with its own patent lawsuit. Runlayer dropped its case after about three weeks of discovery, and Rippling then dismissed its lawsuit without receiving a settlement or reimbursement for legal fees.
An MCP gateway sits between AI agents and enterprise software systems. It can retrieve information for agents while applying controls such as employee permissions, usage logs, and monitoring instead of giving agents unrestricted access to internal systems.
Rippling Expands Further Into AI Infrastructure
After the lawsuits were dropped, Rippling released its AI governance and MCP gateway product. The system connects AI access to employee roles and other company permissions.
Rippling has also recently entered AI model routing, allowing companies to direct requests across different models while tracking token usage and spending by employee. That places parts of its AI infrastructure business alongside products from companies including Stripe, Ramp, and Databricks.
Its MCP gateway competes more directly with companies such as Runlayer, Docker, and Amazon Bedrock.
Runlayer’s MCP Gateway is part of a broader enterprise agent security platform that includes identity-aware access controls, runtime security, activity logs, and monitoring for unauthorized AI tools. The company also offers tools designed to detect AI agents running inside organizations without IT approval.
Featured image credits: Magnific.com
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