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CDS Crypto News Terraform Challenges SEC: Demands Evidence for 4.7B Dollars Disgorgement

Crypto News

Terraform Challenges SEC: Demands Evidence for 4.7B Dollars Disgorgement

The firm's legal representatives argued that any purported losses resulting from the platform's activities or those of Do Kwon occurred beyond the jurisdiction of the United States, falling outside the purview of the SEC's civil case.

Ecem EFE03/05/20241 Mins read227

Terraform Challenges Sec: Demands Evidence For 4.7B Dollars Disgorgement

Crypto News- As the hearing set for May 22 approaches, Terraform Labs (TFL) and co-founder Do Kwon brace for a critical juncture in their legal battle with the U.S. Securities and Exchange Commission (SEC). With both sides gearing up to present their arguments for proposed remedies, tensions escalate over the staggering $5.3 billion sought by the SEC in disgorgement, interest, and civil penalties.

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Terraform Challenges SEC: Demands Evidence for 4.7B Dollars Disgorgement

In a recent filing, Terraform vehemently contests the SEC’s demands, asserting that the regulator lacks substantial evidence to justify such hefty penalties. Lawyers representing the crypto firm emphasize that the SEC’s claims fail to demonstrate how TFL’s or Kwon’s activities directly caused the losses central to the case. Moreover, Terraform underscores that any disgorgement should rightfully involve the Luna Foundation Guard (LFG), a “non-party” in the civil suit.

Jurisdictional Joust: Kwon’s Legal Team Counters SEC’s Reach

Echoing Terraform’s stance, Kwon’s legal team challenges the SEC’s jurisdictional reach, emphasizing that Kwon’s alleged misconduct predominantly occurred outside the U.S., mainly in Korea and Singapore. As the legal wrangling intensifies, both parties await their day in court before Judge Jed Rakoff.

With the fate of Terraform and Kwon hanging in the balance, the upcoming hearing promises to be a pivotal moment in this high-stakes legal saga. Yet, uncertainties loom, particularly regarding Kwon’s availability amidst his extradition proceedings in Montenegro. As the crypto world watches with bated breath, the outcome of this legal showdown could have far-reaching implications for the industry at large.