1 year ago
In the latest ineligible maneuver, Terraform Labs and its erstwhile CEO Do Hyeong Kwon (Do Kwon) person submitted a broad Motion for Summary Judgment, seeking an contiguous dismissal of the fraud charges levied against them by the U.S. Securities and Exchange Commission (SEC).
Terraform Labs and Do Kwon Push Back Against SEC Accusations
Lawyers for Terraform Labs and Do Kwon person challenged the SEC’s accusations, which allege that Kwon and his institution orchestrated a multi-billion dollar crypto-asset securities fraud, involving unregistered transactions and a suite of interconnected crypto-assets. The U.S. regulatory assemblage insists that Kwon played a cardinal relation successful an elaborate scheme, and reportedly manipulated the marketplace to the detriment of investors.
Terraform Labs and Kwon, however, person vehemently denied these accusations, asserting their innocence and challenging the SEC’s ineligible lasting and mentation of the facts. The Motion for Summary Judgment filing argues that the committee has failed to supply factual grounds that they offered oregon sold “investment contracts.”
“After 2 years of investigation, the completion of a find play that resulted successful the taking of much than 20 depositions, and the speech of implicit 2 cardinal pages of documents and data, the SEC is evidentiarily nary person to proving that the defendants did thing wrong,” the attorney’s question insists.
The defendants knock the SEC’s exertion of the Howey test, a ineligible benchmark utilized to find if a transaction qualifies arsenic an concern declaration and frankincense a security. They asseverate that the crypto assets successful question, including UST, LUNA, WLUNA, and MIR, bash not conscionable the criteria of concern contracts, challenging the precise instauration of the SEC’s case.
“All 3 elements of the Howey trial indispensable beryllium met for the merchantability of an plus to represent an concern contract,” the question explains. “After extended discovery, and further probe into the factual grounds underpinning Howey, it is wide that defendants are entitled to summary judgement connected the grounds that the assets astatine contented present are not securities,” the lawyers add.
In summation to disputing the characterization of the crypto assets arsenic securities, Terraform Labs and Kwon besides reason that adjacent if the assets were deemed securities, they would beryllium exempt from registration requirements. “There is nary genuine contented of worldly information that, adjacent if LUNA oregon MIR were securities, they were exempt from registration,” the filing states.
The ineligible stance highlights the complexities of applying accepted securities laws to the rapidly evolving satellite of crypto assets. The question emphasizes the deficiency of clarity successful existing laws and the SEC’s alleged misapplication of these laws. “For each the foregoing reasons, the tribunal should assistance summary judgement successful its entirety with prejudice,” lawyer Douglas Henkin from Dentons US LLP concludes.
What’s your instrumentality connected the ineligible determination by Do Kwon and Terraform Labs aiming to disregard the SEC’s lawsuit? Share your thoughts and opinions astir this taxable successful the comments conception below.
English (US) 