Terraform Labs counters SEC’s ‘slush fund’ claims, alleges government overreach
Quick Take The SEC last week objected to Terraform Labs’ $166 million payment to retain Dentons as its special counsel. Terraform Labs called the SEC’s legal objections a “troubling example of government overreach.”
Terraform Labs has challenged the U.S. Securities and Exchange Commission’s objection to the company’s retention payment of Dentons U.S. LLC as special counsel in its Chapter 11 bankruptcy case, in a filing submitted to a Delaware court on Monday.
Last week, the SEC requested the court to deny Terraform Labs’ retention of Dentons’ as its counsel, taking issue with the company’s $166 million payment to lawyers. SEC claimed that a part of this “suspicious” amount was transferred to “an opaque slush fund,” and that the transfer was made deliberately to avoid paying possible judgment from its enforcement action.
In Monday’s filing , Terraform Labs again requested authority to pay legal expenses, which it said is imperative in defending against the SEC’s litigation and complying with the ongoing investigation from the Department of Justice. The objections made by the SEC are without merit and should be overruled, Terraform Labs said.
“That the SEC, the very party pursuing the Debtor in the SEC Enforcement Action, filed such a vehement objection to the Debtor’s spending its own funds to ensure an adequate defense in the SEC Enforcement Action is a troubling example of government overreach,” Terraform Labs said in the filing. The company claimed that the SEC’s true motives are to distract its focus before the upcoming March 25 trial.
The company also argued that the SEC’s accusations regarding the retention of Dentons include incorrect legal interpretations and false claims.
Terraform Labs filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on Jan. 21, with estimated assets and liabilities between $100 million and $500 million, according to its filing at the time. It said in January that the bankruptcy protection would allow the company to pursue an appeal against the SEC.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
New spot margin trading pair — HOLO/USDT!
FUN drops by 32.34% within 24 hours as it faces a steep short-term downturn
- FUN plunged 32.34% in 24 hours to $0.008938, marking a 541.8% monthly loss amid prolonged bearish trends. - Technical breakdowns, elevated selling pressure, and forced liquidations highlight deteriorating market sentiment and risk-off behavior. - Analysts identify key support below $0.0080 as critical, with bearish momentum confirmed by RSI (<30) and MACD indicators. - A trend-following backtest strategy proposes short positions based on technical signals to capitalize on extended downward trajectories.

OPEN has dropped by 189.51% within 24 hours during a significant market pullback
- OPEN's price plummeted 189.51% in 24 hours to $0.8907, marking its largest intraday decline in history. - The token fell 3793.63% over 7 days, matching identical monthly and yearly declines, signaling severe bearish momentum. - Technical analysts cite broken support levels and lack of bullish catalysts as key drivers of the sustained sell-off. - Absence of stabilizing volume or reversal patterns leaves the market vulnerable to further downward pressure.

New spot margin trading pair — LINEA/USDT!
Trending news
MoreCrypto prices
More








