SEC seeks summary judgment in lawsuit against Terraform, Do Kwon
Quick Take
- A summary judgment is a type of judgment delivered on the basis of statements and evidence without a full trial.
- Terraform and Kwon’s lawyers also filed a similar motion last week, asking a federal judge to nix SEC allegations.
The Securities and Exchange Commission has asked a New York judge to make a decision in its lawsuit against Terraform Labs and its co-founder Do Kwon without a full trial.
The SEC said in a motion for summary judgment filed on Thursday that the evidence that establishes the defendants’ violations is “clear, undisputed and overwhelming” and that the court “should grant summary judgment in the SEC’s favor.”
The securities regulator said that Terraform and Kwon orchestrated a fraudulent scheme that ultimately led to $45 billion in market losses, including devastating losses for U.S. investors.
“In addition to defrauding investors, Defendants engaged in unregistered public offerings of certain of their crypto asset securities,” the SEC added. “Defendants distributed LUNA and MIR to intermediaries that were expected to, and did, resell those securities into public trading markets accessible to investors in the U.S.”
The SEC’s motion comes after the lawyers for Terraform and Kwon submitted a motion for summary judgment last week, saying that the SEC could not prove that they offered or sold securities.
A summary judgment is a type of judgment delivered on the basis of statements and evidence without a full trial.
Mired in lawsuits
The U.S. regulator sued Kwon and Terraform in February, alleging that the company raised billions from investors by offering and selling an inter-connected suite of crypto asset securities, "many in unregistered transactions."
In June, Kwon was found guilty by a court in Montenegro of using a fake Costa Rican passport in an attempt to leave the country in March.
In a separate lawsuit, Terraforms co-founder Daniel Shin was recently on trial in South Korea for several charges including fraud. South Korean prosecutors in April formally indicted Shin and nine others on multiple charges, including violations of capital markets law. Shin’s lawyers said last month in a Seoul court that he had "nothing to do with the collapse, according to local media outlet MBC News.
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