The SEC’s (SEC) service of Terraform Labs CEO Do Kwon at the Mainnet Conference last year in New York was legal, and the company must assist with the commission’s inquiry, according to the Court of Appeals for the Second Circuit.
The legitimacy of the subpoena was challenged by Kwon and Terraform Labs, the firm behind the Terra blockchain, but they lost the court in February and appealed.
The SEC followed its own standards for issuing subpoenas, according to the court, and Terraform Labs’ counsel was not allowed to receive subpoenas.
The court also concluded that Kwon and Terraform Labs have sufficient ties to the United States because the company had employees in the nation and has previously said that 15% of its Mirror Protocol customers are based there.
This case has nothing to do with the Terra ecosystem’s recent collapse. It also has nothing to do with South Korean authorities’ criminal probe into Kwon and Terraform Labs.
