Tron argues that the SEC is ‘not a global regulator’ and the lawsuit goes ‘too far’

Tron, the entity behind Layer-1, has asked a New York federal court to dismiss the US Securities and Exchange Commission's lawsuit against it.

The Tron Foundation said in a March 28 dismissal motion in New York federal court that “the SEC is not a global regulator” and that its efforts to apply US securities laws to “primarily foreign conduct” are “too far-fetched.”

Last March, the SEC sued Sun, the Tron Foundation, file-sharing platform BitTorrent Foundation and San Francisco-based parent company Rainberry Inc. – The latter two acquired Tron in 2018 – suing for the sale of Tron (TRX) and BitTorrent. (BTT) tokens are unregistered securities offerings.

Singapore-based Tron said in its motion that the SEC's case is over “the offering of foreign digital assets to foreign buyers on international platforms,” ​​which it has no jurisdiction over.

Tron said the tokens were sold “entirely overseas” in a move to avoid the US market, and the SEC did not allege they were “primarily issued or sold to any US residents”.

He later said the SEC's claim that the secondary token sales were unregistered US securities “on a US platform that serves users around the world” is “very serious”.

The SEC challenged the Hawaii challenge, arguing that the tokens would fail to qualify as investment contracts under the US securities classification, even if it had jurisdiction.

In the case, the SEC also alleged that Chinese-born Grenadian Sun engaged in “manipulative laundering” — where an entity buys and sells tokens to simulate market activity — and secretly paid celebrities including Soulja Boy and Akon. Introduce signs.

There is no specific information on whether Tron's motions were “laundry trades” wrongfully made for legal purposes (which would significantly affect anyone in the United States).

“The SEC also does not prosecute a victim,” he added.

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Tron's other arguments are that the SEC “failed to detail the actual allegations, detailing each defendant's role in each claim,” and relied on “generalizations and conclusions to support previously thin and frequently undisclosed claims.”

“For example, even if the SEC alleges fraud, no material wrongdoing is alleged, the defendants (and the court) are left to speculate on the merits of those claims,” ​​he wrote.

Tron also argued that the case should be rejected under the doctrine of major questions – a Supreme Court that said that Congress passes laws and does not give them authority from regulators, which other crypto companies, including Kraken and Coinbase, have cited in SEC lawsuit dismissal bids.

The SEC must file its response to Tron's motion within two weeks. The SEC did not immediately respond to a request for comment on the layoff.

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