Tron’s Parent Company Seeks Dismissal of SEC Lawsuit, Citing ‘Predominantly Foreign Conduct’
The entity behind the layer-1 blockchain Tron has requested the dismissal of a lawsuit filed by the United States Securities and Exchange Commission (SEC) against it, arguing that the regulator’s focus on “predominantly foreign conduct” goes beyond its jurisdiction.
In a dismissal motion filed on March 28 in a New York federal court, the Tron Foundation stated that the SEC’s attempt to apply US security laws to predominantly foreign activities exceeds the regulator’s authority as it is not a global regulatory body.
The SEC’s lawsuit, filed in March of last year, targeted Tron founder Justin Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry Inc., the San Francisco-based parent company of BitTorrent, which Tron acquired in 2018.
The SEC alleged that the sale of Tron and BitTorrent (BTT) tokens constituted unregistered securities offerings.
The Tron Foundation, based in Singapore, argued in its motion that the tokens were sold exclusively overseas, with measures taken to avoid the U.S. market, and that the SEC did not claim they were initially offered or sold to U.S. residents.
Tron further argued that even if the SEC had jurisdiction, the tokens would not meet the criteria of investment contracts under the U.S. securities classification, as defined by the Howey test.
Breaking: Justin Sun and @trondao request dismissal of @SECGov lawsuit arguing the #SEC has no authority over global token sales to foreign users, claims $TRX tokens sold outside USA
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