Prosecutors failed to convince a South Korean District Court that Terra’s native token LUNA (now LUNC) can be considered an investment contract.
According to a Monday report from local media outlet Ilyo, efforts to prosecute Terraform Labs co-founder Shin Hyun-seung, also known as Daniel Shin, stalled once again after the court dismissed an appeal on a previously dismissed arrest warrant.
A South Korean District Court ruled that the prosecution’s case against Shin is centred around violations of securities laws, but the underlying asset in the picture, LUNA, cannot be considered an investment product that is regulated under the Capital Markets Act.
According to Shin’s lawyers, the prosecution has attempted to issue 10 or more arrest warrants for Shin and other executives associated with Terraform Labs. So far, none of these requests for arrest warrants have been successful.
Earlier this month, prosecutors said they estimated the total criminal proceeds involved in Terraform Labs’ fraud amounted to $314 million. They also began seizing assets from the Terra employees that face charges, confiscating $76 million worth of property from Shin alone.
Today, the Southern District Court ruled that the property could not be confiscated in principle under existing laws.
Prosecutors have now requested the Supreme Court of Korea for a judgment.
Meanwhile, Terra CEO Do Kwon, currently facing an indictment in Montenegro, has requested a U.S. court to dismiss charges brought against him by the Securities and Exchange Commission (SEC). In a motion filed on Friday, Kwon’s attorneys argued that the SEC lacks the legal jurisdiction to bring a lawsuit related to the UST stablecoin because it is a currency rather than a security.