#Terraform Labs Fights Back: $5.3 Billion SEC Fine Faces $1 Million Counterpunch

Terraform Labs (#TFL ) is throwing punches back at the SEC's hefty $5.3 billion fine for Do Kwon's alleged fraud with #TerraUSD (#UST ). Their lawyers argue the penalty should be slashed to just $1 million, a 99% reduction.

The crux of their defense? The Luna Foundation Guard (LFG), not TFL, held the funds from the UST sales. TFL's lawyers claim the SEC should have pursued LFG directly for disgorgement (returning those funds).

This counters the SEC's demands for $4.7 billion in disgorgement and prejudgment interest, plus $520 million in civil penalties.

This legal battle adds another layer to the Terraform Labs saga. The company and Do Kwon were found guilty by a jury in April, leading to his current extradition fight in Montenegro.

The ripple effects of Terraform Labs' collapse in 2022 are still felt, with companies like BlockFi, Celcius, and #FTX all facing bankruptcy.

Will TFL's legal counteroffensive land? Only time will tell, but this fight is far from over.