Terraform Labs being Sued for Misleading Investors
Do Kwon's questionable behavior is also being questioned in the lawsuit...
The plaintiff in a lawsuit filed against Do Kwon, the Luna Foundation Guard, and other Terra-related entities has alleged that the parties mentioned have misled investors regarding if the Terra tokens are even actual securities.
Nick Patterson filed the lawsuit over the weekend in a United States District Court in Northern California and alleges several VS firms, Terraform Labs, and the founder Do Kwon have violated many federal securities laws with the sale and promotion of UST and LUNA. More specifically, Nick Patterson claimed the two tokens resembled securities and were promoted via misleading information
“On top of selling unregistered securities with the Terra Tokens, Defendants made a series of false and misleading statements regarding the largest Terra ecosystem digital assets by market cap, UST and LUNA, in order to induce investors into purchasing these digital assets at inflated rates.”
Nick Patterson wrote in his statement.
In the lawsuit, it is said that “a group of six venture capital groups that promised to support and fund the Terra ecosystem and to defend the peg in the event of high volatility caused the UST/Luna pair to become untethered from one another.” Those who failed to keep their promises:
Among the individuals targeted within the lawsuit was Do Kwon surrounding his behavior prior to the fall of the tokens. “One of Kwon’s go-to insults is to demean and delegitimize his detractors or critics of the Terra Tokens by dismissing them as ‘poor.’” Kwon was repeatedly mocking people who would criticize the algorithm and one event specifically occurred which is now being used against Do Kwon when he told a British economist “I don’t debate the poor on Twitter, and sorry I don’t have any change on me for her at the moment.”