Terraform co-founder Do Kwon asks court to dismiss the SEC lawsuit, here’s why

Terraform co-founder Do Kwon asks court to dismiss the SEC lawsuit, here’s why

  • Do Kwon’s lawyers argued in court that SEC’s lawsuit should be dismissed.
  • U.S. authorities sued Kwon for allegedly scamming U.S. investors.

According to a news report, the lawyers for Terraform Labs co-founder Do Kwon argued in court against the claims made by the U.S. Securities and Exchange Commission (SEC).  The federal authorities sued Kwon for allegedly scamming American investors by illegally providing unregistered securities.

A Bloomberg report said that Do Kwon’s lawyers requested the judge to dismiss the SEC action. They alleged that the regulator’s claims were unjustified.

Kwon’s lawyers said in their motion to dismiss the complaint that U.S. law forbids authorities from employing federal securities legislation to establish jurisdiction over the crypto assets in this case.

Furthermore, the lawyers stated that the SEC failed to prove Kwon cheated investors as a result of the collapse of the TerraUSD [USTC] and Luna [LUNA] cryptocurrencies.

South Korea and United States go after Do Kwon

Do Kwon was arrested on 23 March at Podgorica airport in Montenegro while trying to fly to Dubai using forged passports. Following his detention, both South Korean and American officials have sought his extradition. 

As of now, it is not sure which country, if any, would be most likely to be granted Kwon’s extradition.

Moreover, an arrest order for Terraform Labs co-founder Shin Hyun-Seong was recently denied by the Seoul Southern District Court.

While prosecutors saw Kwon’s arrest as a chance to apprehend Shin, the court refused the motion. The refusal cited unverified charges and the unlikely occurrence of Shin fleeing or destroying evidence.

Montenegrin Justice Minister Marko Kovač said,

“In the case when we receive several extradition requests, I would like to say that determining to which state they will be extradited is based on several factors like the severity of the committed criminal offense, the location and time when the criminal offense has been committed, the order in which we have received the request for extradition and several other factors.”

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