Runlayer and Rippling dismiss competing MCP gateway lawsuits
Runlayer and Rippling have dismissed their respective lawsuits over MCP gateway technology, ending a short but highly public dispute without a settlement, payments or awards of legal fees. Court documents seen by TechCrunch show that both sides withdrew their claims, and Rippling immediately released its own MCP gateway, the product at the centre of the confrontation.
Runlayer, an early-stage startup that emerged from stealth in November 2025, had sued after Rippling tested its MCP gateway for more than a year. The company said the engineering teams had worked closely during that period, but Rippling did not become a customer. Runlayer alleged that Rippling then built a competing product, violating contractual arrangements that governed the testing process.
A dispute over enterprise AI access
An MCP gateway handles requests from enterprise AI agents for information held in other software systems. If a hiring professional asks an agent for the five strongest candidates and their email addresses, the gateway can retrieve that information from a recruitment platform rather than giving the agent direct access to the underlying system.
The technology can also add employee role-based access controls, so managers and interns receive different permissions, as well as observability features such as logs and usage trails. Runlayer’s earlier allegations centred on the pilot work around this type of gateway, as outlined in Runlayer's MCP gateway pilot allegations amid the company’s claims about use of pilot materials.
Rippling countersued Runlayer, alleging patent infringement. Runlayer viewed that action as an attempt to increase legal costs and encourage it to drop its case. After three weeks in discovery, Runlayer withdrew its suit; Rippling then withdrew its own claim. Neither party collected a settlement.
Rippling expands beyond payroll
The release puts Rippling, historically known for payroll and benefits management, into the AI Gateway market. Its tool can route requests to different models and provide a dashboard for token spending by employee. That places it alongside providers including Stripe, Ramp and Databricks in this part of the market.
Its MCP gateway also links AI access to employee roles, positioning Rippling in enterprise AI security against companies including Runlayer, Docker and Amazon Bedrock. Runlayer’s broader proposition includes agent security services around the gateway, from agent creation to identifying shadow AI agents operating without IT’s knowledge.
What founders should take from the case
The dispute illustrates how quickly enterprise AI buying and building priorities can move. Long technical evaluations may last months, while a prospective customer’s requirements and product ambitions can change within weeks. Founders entering extended pilots should define testing and contractual boundaries carefully, while recognising that the customer relationship may evolve into direct competition.