Terraform Labs (TFL) and former CEO Do Kwon are seeking to dismiss the lawsuit filed by the U.S. Securities and Exchange Commission (SEC) using Judge Torres’ ruling in the XRP lawsuit. Terra and Do Kwon previously filed documents in support of the motion to dismiss the lawsuit, claiming that the US SEC has no jurisdiction and that LUNC and UST (now USTC) are not securities under the “investment contract” rule.
Also Read: Ripple Community Mocks Republican For Calling XRP A Security; Analyst predicts re-entry level
Terra Do Kwon uses “Torres Doctrine” to dismiss SEC lawsuit
Terraform Labs (TFL) and co-founder Do Kwon’s attorneys have filed additional warrants in support of the motion to dismiss the U.S. Securities and Exchange Commission’s (SEC) lawsuit. Judge Jed Rakoff granted both defendants and the plaintiff to file a Notice of Additional Jurisdiction regarding the dismissal of the lawsuit.
Attorneys from leading law firm Dentons, representing Terraform Labs and co-founder Do Kwon, argued that Judge Analisa Torres’ landmark decision in US SEC v. Ripple Labs directly affects the defendants’ motion to dismiss the lawsuit. SEC states that UST, LUNA, wLUNA, MIR or mAssets are securities. However, the Ripple case confirms SEC’s legal inadequacy in proving its claim that cryptocurrencies, other than Bitcoin, are securities. Programmatic sales of digital assets are also not securities, but institutional sales are securities in terms of investment contracts.
It further states that SEC has not alleged that UST was sold to anyone, directly or on a secondary market. The SEC even alleged that Terra sold LUNA and MIR on secondary markets, which are not investment contracts under the XRP ruling.
In addition, the institutional sales of LUNA and MIR were not for resale and were exempt from registration. In addition, a South Korean court ruled that LUNA is not security, further strengthening Terraform Labs’ case.
“The LUNA and MIR sales were nothing like the institutional sales in Ripple: the LUNA and MIR sales were smaller, and the Terra ecosystem messages were about participation by ecosystem participants and not just about adding value to one ecosystem.”
Terraform Labs requires the rejection of the U.S. Securities and Exchange Commission’s fraud and registration claims.
The price of Terra (LUNA) is currently trading at $0.65, up 10% in a week. Meanwhile, Terra Classic (LUNC) and USTC are trading at $0.000087 and $0.016, up 4% and 37% respectively in a week.
Also Read: Terra Luna Classic Core Developer L1TF Members Resigned, Community Responds
Varinder has 10 years of experience in the Fintech sector, with more than 5 years dedicated to blockchain, crypto and Web3 developments. A technology enthusiast and analytical thinker, he has shared his knowledge of disruptive technologies in more than 5,000 news stories, articles and newspapers. With CoinGape Media, Varinder believes in the enormous potential of these innovative future technologies. He is currently covering all the latest updates and developments in the crypto industry.
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