The specifics regarding the documents subject to the subpoena were unclear, but it was noted that Genesis had failed to furnish the required information by the deadline of October 9th.
In the United States, a judge has granted an order mandating that Genesis Global entities produce specific documents in response to a subpoena requested by Terraform Labs.
A filing made on October 13th in the U.S. District Court of the Southern District of New York, by Judge Jed Rakoff, stipulated that Genesis would be given a grace period of five days, likely until October 18th, to deliver the requested documents following Terraform Labs’ subpoena. As per the filing, Genesis had fallen short of providing the required records by October 9th, as mandated by the September 12th subpoena. Nevertheless, the nature of the documents sought by the cryptocurrency firm remained ambiguous.
This order is part of the U.S. Securities and Exchange Commission’s ongoing civil case against Terraform Labs, as well as its co-founder and CEO, Do Kwon. The initial filing dates back to February, and currently, Kwon is serving a four-month prison sentence in Montenegro for his involvement with falsified travel documents, while the lawsuit against Terraform Labs continues in the United States.
U.S. regulatory authorities have accused Terraform Labs and Kwon of “misleading and deceiving investors” through claims related to their algorithmic stablecoin, Terra USD (UST). The collapse of the Terra ecosystem played a pivotal role in the crypto market crash of 2022, which preceded the bankruptcies of FTX, BlockFi, Celsius Network, Voyager Digital, and other entities.
Genesis sought bankruptcy protection in January, estimating its liabilities at approximately $1 billion against $10 billion in assets at that time. Both the company and the cryptocurrency exchange Gemini faced legal action initiated by the SEC in January, with the regulator alleging that they had offered unregistered securities through Gemini’s Earn program.