- The U.S. District Court ruled that TerraForm Labs violated the Securities Act.
- TerraForm Labs co-founder Do Kwon wishes to attend the looming SEC trial.
- Federal Judge rejected several reconsideration motions on January 11, 2024.
The infamous cryptocurrency entrepreneur Do Kwon aims to postpone the trial hearing in the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Kwon and TerraForm Labs. Currently serving jail time in Montenegro for multiple document forgery charges, Mr. Kwon’s legal defense team penned an official request to the United States Judge Honorable Jed S. Rakoff to impose a delay on the approaching court hearing, which is slated for January.
Instead, Do Kwon wants to reschedule the court hearing in the United States to March, basing the wish on the fact that the controversial crypto mogul is still serving a sentence in Europe and is not likely to be present in the United States by the end of this month. Due to the prolonged extradition process, Kwon’s counsel estimates that Kwon isn’t likely to be extradited until “February of March at the earliest”.
Federal Judge Denies Reconsideration Motions
While the crypto community awaits the decision regarding the possible rescheduling of the high-profile TerraForm Labs customer defrauding case, Judge Jed S. Rakoff sided with the SEC’s arguments, labeling the LUNA, UST, and MIR tokens as securities. The Federal Judge clearly stated that “there is no genuine dispute that UST, LUNA, wLUNA, and MIR are securities because they are investment contracts”.
In the latest development, Judge Rakoff denied a pile of motions to reconsider earlier orders. Siding with the SEC, Judge Rakoff affirmed that there’s enough evidence to proceed with the trial, calling Terra Form Labs’ defensive actions an attempt to “cast aside decades of settled law”.
While the undisputed king of Hide ‘n’ Seek is still serving time for document forgery on a dramatic attempt to flee to Dubai, Kwon’s defense team are inclined to provide the jury with an explanation regarding Do Kwon’s absence if the hearing is held this month.
On the Flipside
- In this particular case, both parties had requested a legal summary judgment in order to avoid a trial.
- Both the SEC and TerraForm Labs defense argued that the other party did not provide substantial arguments in the case.
- TerraForm Labs attorneys also argue that the Securities and Exchange Commission lacks the jurisdiction to rule TerraForm Labs’ case.
Why This Matters
The high-profile legal case of TerraForm Labs vs. the SEC can bring a clearer legal framework for cryptocurrency and assist in preventing financial catastrophes like the UST crash in May 2022.
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