The leading law firm, Dentons, has filed additional documents that support the dismissal of the lawsuit against Do Kwon. The recent court hearing on Thursday revolved around whether or not the assets created by Terraform Labs are securities under the investment contract. As of now, the lawyers of Do Kwon and the SEC have filed motions to dismiss the lawsuit in the US District Court for the Southern District of New York.
The lawyers from Denton argue that the USTC stablecoin is not a security, mainly because it was designed for practical purposes instead of investment purposes. The additional documents filed by the lawyers representing Do Kwon include the US House Financial Services Committee hearing on a digital asset regulation along with stablecoin issuance.
It also includes the SEC’s recent request regarding a restraining order on Binance, along with the Hinman documents in the SEC’s lawsuit against Ripple. The lawyers have mentioned the regulatory gap as it is still unclear whether or not digital assets are to be regarded as securities. At the same time, these lawyers argue that the SEC is acting outside the boundaries of securities law.
The lawyers representing the SEC argue that the additional documents filed by the defendants do not support the motion to dismiss the lawsuit. Moreover, the events and the documents surrounding crackdowns against Binance and Ripple do not have anything to do with the case.
These lawyers claim that the Howey test highlights the factors that make up an investment contract, along with the fact that USTC has always been a security.
Do Kwon Will Be Extradited to South Korea
It is expected that the judges will rule on the decision of the lawsuit’s dismissal on July 14 this year. Despite the argument of the SEC’s lawyers, a South Korean court ruled that LUNC was not a security, and all assets of Terra are not investment contracts.
A Montenegro court recently approved the bail of Do Kwon along with the former CTO, Han Chang-joon. But both of them are bound to stay behind bars as it has been ordered to extradite them back to South Korea based on fraud charges. Currently, the extradition detention of Do Kwon stands at six months.
