Federal judge gives Genesis 5 days to comply with Terraform Labs subpoena
The order was unclear as to the nature of the documents under subpoena but stated Genesis had failed to provide the information by Oct. 9.
A United States judge has approved an order requiring Genesis Global entities to produce certain documents in accordance with a subpoena requested by Terraform Labs.
In an Oct. 13 filing in the U.S. District Court of the Southern District of New York, Judge Jed Rakoff said Genesis would have five days — likely until Oct. 18 — to produce documents following a subpoena from Terraform Labs. According to the filing, Genesis failed to provide records by Oct. 9 as was required by a Sept. 12 subpoena, though the order was unclear as to what documents the crypto firm was seeking.
The order was part of the U.S. Securities and Exchange Commission’s civil case against Terraform Labs and its co-founder and CEO, Do Kwon, first filed in February. Kwon is currently serving a four-month prison sentence in Montenegro for using falsified travel documents while the lawsuit against Terra continues in the United States.
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U.S. regulators have alleged Terraform Labs and Kwon “misled and deceived investors” with claims about its algorithmic stablecoin, Terra USD (UST). The collapse of the Terra ecosystem was one of the precipitating events in the crypto market crash of 2022, prior to the bankruptcies of FTX, BlockFi, Celsius Network, Voyager Digital and others.
Genesis filed for bankruptcy protection in January, estimating its liabilities to be roughly $1 billion with $10 billion in assets at the time. Both the firm and cryptocurrency exchange Gemini were the targets of a civil suit filed by the SEC in January. The regulator alleged the companies offered unregistered securities through Gemini’s Earn program.
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