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Runlayer sues Rippling, alleging source-code access preceded rival AI gateway - RuntimeWire

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Why it matters

AI infrastructure vendors must expose enough of their systems to win enterprise trials. Runlayer's case tests whether contracts can stop technically capable customers from using that access to build competing products.

Runlayer sued HR software company Rippling on July 28, alleging that a customer evaluation gave Rippling access to Runlayer's complete application source code and other confidential systems before Rippling developed a competing gateway for artificial intelligence agents, Reuters reported.

The 32-page complaint centers on four claims:

A four-month software trial continued for nearly a year.

Rippling received Runlayer's source code, deployment architecture, security designs, product roadmap and pricing.

Usage grew to thousands of Rippling employees without a company-wide subscription.

An unnamed Rippling insider warned Runlayer CEO Andrew Berman of an internal project that was allegedly "almost a 1 to 1 copy."

Rippling denies the allegations. A spokesperson told TechCrunch that its upcoming gateway was built using Rippling's proprietary information and called Runlayer's claims fabricated.

No judge has determined whether Runlayer's account is true. The complaint currently presents only Runlayer's side.

A four-month trial continued for nearly a year

Berman founded Runlayer with former Zapier AI engineers Tal Peretz and Vitor Balocco. The startup sells a control platform for enterprise AI agents.

Its gateway handles Model Context Protocol requests, sitting between AI agents and enterprise systems to enforce permissions, inspect activity and maintain audit records. MCP is an open standard for connecting AI models and agents to outside tools and data.

According to the complaint, Rippling began evaluating Runlayer under a mutual nondisclosure agreement and a trial agreement that prohibited copying Runlayer's intellectual property or creating derivative works. The trial was supposed to last four months.

Runlayer alleges that it instead continued for nearly a year, without Rippling returning the software, ending the trial or converting to a paid commercial subscription. Usage reached thousands of Rippling employees by May 2026, the complaint says.

Runlayer says the access included:

Its complete application source code, provided for installation in July and August 2025.

Gateway deployment architecture, topology and operating methods.

Customer-specific architecture and product roadmap decisions.

Security-scanning systems, authorization designs and audit implementations.

Confidential pricing.

The companies also maintained a shared Slack channel called #ext-runlayer-rippling, according to the complaint. Runlayer says the channel supported architecture reviews, security demonstrations, coding sessions, plugin-design meetings, deployment troubleshooting, roadmap discussions and workshops tailored to Rippling's engineering priorities.

Runlayer cites an April 2026 customer research interview with Tim Fall, Rippling's technology lead for developer experience. The complaint says Fall described Runlayer as the only vendor he knew of that had solved the governance and enablement challenges created by enterprise AI adoption.

If accurately documented, that statement could support Runlayer's argument that Rippling understood the distinct value of its implementation rather than merely evaluating a generic MCP tool.

Procurement stalled as engineering work continued

Runlayer says it offered Rippling a discounted company-wide license as usage expanded, but Rippling's procurement team pressed for a lower price. Meanwhile, the complaint alleges, Rippling engineers continued requesting non-public guidance about Runlayer's agent, security, audit and policy capabilities.

The startup says this sequence is central to its case: Rippling allegedly obtained increasingly detailed technical assistance while declining to pay for the broader deployment that assistance supported.

Runlayer warned on June 10 that it would suspend the pilot without an agreement. Procurement did not respond, according to the complaint, and Runlayer shut off Rippling's service on June 12.

The unnamed insider contacted Berman that day, the complaint alleges. The first quoted message said:

There's some things happening on the Rippling side that you should probably know about but I didn't want to put them in Slack.

The insider then allegedly described the internal project:

There's been a project internally to build essentially a clone of Runlayer. When I raised objections originally...