Bragar Eagel & Squire has filed a new class action lawsuit against TerraForm Labs and its CEO, Do Kwon, in the state of California. In addition, the company has launched a class action lawsuit in the state of New Jersey against Celsius Network, Alexander Mashinksy, and other businesses and persons associated with the cryptocurrency lender.
The case was filed on behalf of investors who bought Terra tokens such as UST, LUNA, and MIR between May 20, 2021 and May 25, 2022. Terraform has been accused of deceiving investors.
According to the lawsuit, Terraform Labs and other defendants violated the Exchange Act by deceiving investors into purchasing Terra tokens at “artificially inflated prices” and luring naïve investors with misleading assurances.
Terraform Labs is also accused of violating securities legislation by neglecting to register Terra tokens as securities. She goes on to say that all of the defendants violated the RICO Act by operating the company’s operations in a racketeering manner.
Three Arrows Capital, Jump Crypto, Nicholas Platias, and other Terra-related entities are among the other defendants in the lawsuit.
Meanwhile, on July 17, Nick Patterson filed a similar case against Terra. Patterson claimed that the Terra tokens were securities and that Terraform Labs failed to manage the Terra ecosystem, causing individual investors to lose money.
Patterson requests that the court deem Terra tokens to be securities and that investors be entitled to “punitive and consequential penalties and restitution” from the defendants.