Do Kwon and Terra’s legal woes have increased as an international law firm files a lawsuit against him and his company TerraForm Labs.
Popular securities and consumer rights litigation firm Scott+Scott Attorneys, has announced that it has filed a lawsuit against Do Kwon, the CEO and founder of TerraForm Labs, as well as other top TFL executives, in a bid to bring justice to investors affected in the collapse of $UST and $LUNA.
According to a recent announcement, the case, dubbed Patterson v. TerraForm Labs Pte Ltd. et al., was filed in the United States District Court of California.
Aside from Kwon, top TFL executives and other top cryptocurrency-related companies listed as defendants in the lawsuit include Three Arrow Capital (3AC), Tribe Capital, Defiance Capital, Jump Trading, and Jump Crypto.
“This class action is filed […] on behalf of a class consisting of all persons and entities, other than Defendants and their affiliates, who purchased so-called Terra Tokens from May 20, 2021, and May 25, 2022 inclusive (the “Class Period”), and who were damaged thereby,” excerpt of the announcement reads.
Defendants Allege to Breach Multiple U.S. Laws
Scott+Scott Attorneys asserted that the defendants breached various United States securities laws via their offerings, which plunged investors into serious losses.
“The Defendants violated the provisions of the California Common Law by possessing the monetary value of Terra tokens at an inflated value which rightfully belongs to the Plaintiff and members of the Class,” Scott+Scott Attorneys allege.
With the case registered in the United States district court of California, Scott+Scott Attorneys have urged affected cryptocurrency investors to reach out to their support team via phone number and email for more information.
Kwon and TFL Legal Woes Increases
The latest developments further pile on to the woes of Kwon and TFL. Kwon and TerraForm Labs have faced widespread scrutiny over the collapse of the Terra project.
While several reports claim that it was the poor design of Terra that led to the collapse of the cryptocurrency project, other reports suggested that $UST and $LUNA crashed due to the fraudulent transactions Kwon conducted weeks before the unfortunate incident.
Whichever the case, TFL suffered one of the biggest crashes in the history of the cryptocurrency industry, with the value of its algorithmic stablecoin $UST losing its dollar peg and plunging to a low of $0.07.
At the time of writing, Terra investors are yet to recover from the massive losses they incurred via their investments in Terra tokens.