New developments have emerged in the SEC’s $5.3 billion lawsuit against Terraform Labs and Do Kwon.
In the Terra (LUNA) lawsuit against the SEC, lawyers representing Terraform Labs are wrestling with the U.S. Securities and Exchange Commission (SEC) after the regulatory agency sought a multibillion-dollar penalty.
The company’s legal team argues that the sale of tokens occurred “almost exclusively outside the United States,” according to a summary judgment motion filed Wednesday.
The SEC disputes this claim, arguing that Terraform Labs “targeted U.S. investors” and thus owes a hefty $5.3 billion, largely in disgorgement.
However, Terraform’s lawyers took issue with this, saying: “The SEC has offered no evidence that Defendants’ limited activities in the United States caused, directly or indirectly, any losses in the United States, much less losses in an amount approaching the disgorgement that the SEC seeks.”
The SEC previously charged Terraform Labs and co-founder Do Kwon over the TerraUSD (UST) stablecoin in February 2023.
Last month, a jury found both Terraform Labs and Kwon liable for defrauding investors and held them responsible for civil fraud.
The legal battle between Terraform Labs and the SEC continues as the future of the company and its cryptocurrencies remains uncertain.
