tl;dr
TRON Foundation and Justin Sun Seek Dismissal of SEC Lawsuit The TRON Foundation and its founder, Justin Sun, have filed a motion to dismiss a lawsuit from the U.S. Securities and Exchange Commission (SEC) in a New York court, contesting the regulator's jurisdiction over foreign defendan...
TRON Foundation and Justin Sun Seek Dismissal of SEC Lawsuit
The TRON Foundation and its founder, Justin Sun, have filed a motion to dismiss a lawsuit from the U.S. Securities and Exchange Commission (SEC) in a New York court, contesting the regulator's jurisdiction over foreign defendants and alleging lack of fair notice for the claims. The case, which dates back to March 2023, involves accusations of selling and airdropping unregistered securities, fraud, and market manipulation. The defendants argue that the SEC's claims fail for various reasons, including lack of jurisdiction, insufficient notice, and premature regulatory action. This legal battle underscores the complex interplay between global digital assets and the reach of U.S. securities laws, with implications for regulatory authority and oversight in the evolving blockchain landscape.
Key Points:
- The TRON Foundation asked a New York court to dismiss an SEC lawsuit against it and others.
- The March 2023 case pertains to allegations of selling and airdropping unregistered securities, fraud, and market manipulation.
- The defendants, including Sun and the TRON Foundation, contest the SEC's jurisdiction and claim lack of fair notice for the allegations.
The defendants argue that the SEC's claims fail for various reasons, including lack of jurisdiction, insufficient notice, and premature regulatory action. This legal battle underscores the complex interplay between global digital assets and the reach of U.S. securities laws, with implications for regulatory authority and oversight in the evolving blockchain landscape.
California-registered Rainberry did not contest the court's jurisdiction, instead asking for dismissal for other reasons, including that the defendants did not receive fair notice. "There was no fair notice that the SEC would attempt to pursue claims like those alleged here – reaching global contests and giveaways, free airdrops, and secondary trading in tokens (issued overseas, years earlier) on a developing blockchain, with few specific ties to the United States," the filing said.
Another reason cited is that the action was premature under the major questions doctrine – a legal precedent that is meant to curb government overreach, implying that Congress writes the rules that agencies like the SEC are meant to follow. " ... the SEC’s unprecedented, novel expansion of its regulatory power to the global digital asset market is also a 'transformative expansion' of its regulatory authority in the absence of 'clear congressional authorization,' presenting a novel issue under the major questions doctrine and warranting dismissal," the filing said.
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