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After a jury found Terraform Labs and co-founder <a href="https://cointelegraph.com/top-people-in-crypto-and-blockchain-2023/do-kwon" rel="noopener noreferrer nofollow">Do Kwon</a> liable for fraud in a case with the United States Securities and Exchange Commission (SEC), a federal judge ordered the parties to discuss proposed remedies ranging from millions to billions of dollars.
In an April 29 filing in the U.S. District Court for the Southern District of New York, Judge Jed Rakoff <a href="https://storage.courtlistener.com/recap/gov.uscourts.nysd.594150/gov.uscourts.nysd.594150.243.0.pdf" target="_blank" rel="noopener noreferrer nofollow">said</a> lawyers representing the SEC, Kwon and Terraform should appear in court on May 22 to present arguments for proposed remedies after the jury verdict. All parties have already submitted filings on their respective requests for disgorgement and civil penalties, but Judge Rakoff’s order allowed supplements before the court appearance.
Related: <a href="https://cointelegraph.com/news/do-kwon-montenegrin-court-appeal-extradition-law" rel="noopener noreferrer nofollow">Do Kwon appeals Montenegrin court decision, claiming ‘unfounded and illegal’ interpretation</a>
<figure><img src="https://s3.cointelegraph.com/uploads/2024-04/146323c4-8a46-42e0-b5ca-c5fca0cd1863.png">
 <figcaption style="text-align: center;">Source: <a href="https://storage.courtlistener.com/recap/gov.uscourts.nysd.594150/gov.uscourts.nysd.594150.243.0.pdf" target="_blank" rel="noopener noreferrer nofollow">Courtlistener</a>
 </figcaption>
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The SEC requested Kwon and Terraform <a href="https://cointelegraph.com/news/sec-judgment-terraform-labs-do-kwon" rel="noopener noreferrer nofollow">pay roughly $4.7 billion</a> in disgorgement and prejudgment interest and a combined $520 million in civil penalties. Terraform’s legal team <a href="https://cointelegraph.com/news/terraform-labs-penalty-sec-civil-case" rel="noopener noreferrer nofollow">suggested a $1 million civil penalty</a> and no “injunctive relief or disgorgement.” Both parties will have until May 6 and May 1, respectively, to file supplements to their existing proposals.
Related: <a href="https://cointelegraph.com/news/do-kwon-montenegrin-court-appeal-extradition-law" rel="noopener noreferrer nofollow">Do Kwon appeals Montenegrin court decision, claiming ‘unfounded and illegal’ interpretation</a>
On April 5, a jury found Terraform and Kwon <a href="https://cointelegraph.com/news/terraform-labs-do-kwon-liable-fraud-sec" rel="noopener noreferrer nofollow">liable for defrauding investors</a> after a two-week trial with the SEC. Kwon could not attend the trial in person due to his 2023 arrest in Montenegro for using falsified travel documents. The Terraform co-founder remains in the country as its courts weigh extradition requests from the U.S. and South Korea, and at the time of publication, it was unclear if he will be able to go to the U.S. court on May 22.
Bankruptcy proceedings for Terraform have been ongoing since the company <a href="https://cointelegraph.com/news/do-kwon-terraform-labs-files-chapter-11-bankruptcy-protection" rel="noopener noreferrer nofollow">filed for Chapter 11 protection</a> in January. The firm reported between $100 and $500 million in estimated liabilities and assets at the time.
Magazine: <a href="https://cointelegraph.com/magazine/6b-scam-accused-court-china-loophole-hong-kong-bitcoin-etf-asia-express/" rel="noopener noreferrer nofollow">Woman accused of $6B scam, China loophole for Hong Kong Bitcoin ETFs: Asia Express</a>

US Court to hear proposed remedies from Terraform Labs, Do Kwon in May

Cointelegraph

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