BREAKING: Judge Issues Ruling In SEC V Terraform Labs Case

December 28, 2023 7:07 pm Comments

A New York Court has issued several mixed rulings in the SEC case against Terraform Labs and founder Do Kwon.

Judge Jed Rakoff sided with the SEC over claims that Terraform Labs sold unregistered securities to investors, but sided with Terraform Labs on the charges relating to security-based swaps.

Additionally, the judge denied motions to fast-track the fraud charges from both Terraform Labs and the SEC.

ProCoin News previously reported that Terraform founder Do Kwon was set to be extradited to the United States from Montenegro to stand trial.

However, Kwon appealed, and his extradition will now be delayed pending a legal review by the courts. It remains to be seen if this recent ruling from Judge Rakoff influences the courts in Montenegro. Here are the latest breaking updates:

Coin Telegraph reports:

According to court documents, the court granted summary judgment for the SEC on Count IV of the Amended Complaint, involving the defendants’ unregistered offers and sales of LUNA and MIR tokens in violation of Sections 5(a) and (5c) of the Securities Act.

Journalist Leo Schwartz asked: “In Judge Rakoff’s decision today finding that Terraform Labs sold unregistered securities, he argues that UST—ostensibly pegged to $1—was a security because it was offered in conjunction with Anchor Protocol, which offered a yield. Seems potentially bad for USDC?”

The Block provided this statement from Judge Rakoff:

“There is no genuine dispute that UST, LUNA, wLUNA, and MIR are securities because they are investment contracts.”

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