Collective action accuses Terraform Labs of deception of investors
Collective action accuses Terraform Labs of deception of investors
- Suit claims that the Terra leader do Kwon, Nicholas Platias and others handled their business "through a pattern of blackmail activities".
- Terraform Labs could not register Terrausd (VAT), Terra (Luna) and other tokens, the complaint says
The law firm Bragar Eagel & Squire has submitted a crime lawsuit against Terraform Labs, the company that developed the Terra-Blockchain after the crash of various Terra tokens in May.
The company submitted the lawsuit against Terraform Labs at the US district court for the northern district of California in the name of those who bought Terra token between May 20, 2021 and May 25, 2022 A press release released late Sunday evening.
One of the other defendants is the co-founder of Terraform Labs Make Kwon Former research manager of Terraform Labs Nikolaus Platias , Jump Crypto, GSR and Three Arrows Capital. Until August 19, investors have time to apply as the main plaintiff.
The lawsuit comes after the crash of the algorithmic stable coins Terrausd (VAT) and Terra (Luna) in May. The prices of VAT and Luna fell by 91 % or 99.7 % between May 7 and May 12th and never recovered. The Terra-Blockchain was then restarted without VAT and left a renamed Luna Classic (LUNC), and VAT is currently being traded at less than $ 3 cents.
In the complaint, it is claimed that the defendants have deceived small investors by lying, omissions of facts and the confirmation of misleading statements, which caused them to buy Terra token at "artificially inflated prices".
It also means that you have violated the Securities Act by participating in the non-registration of the Terra token by Terraform Labs.
Finally, the law firm accuses the accused of violating the Racketeter influenced and corrupt organizations Act (Rico) "by having managed the business of a company through a pattern of blackmail activities".
Terraform Labs did not send back a request for comment immediately.
The lawsuit follows the confiscation of transaction records and other documents from South Korean crypto bonds last week by investigators from the South district of Seoul. According to reports, the prosecutors examine whether the crash of the digital tokens of Terra was a deliberate step by Kwon.
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The post-collection lawsuit accuses Terraform Labs, to deceive investors, is not a financial advice.