Genesis and its affiliated companies were ordered by a judge to produce documents October 13as part of a securities lawsuit initiated by the U.S. Securities and Exchange Commission (SEC) against Terraform Labs.
The US Securities and Exchange Commission (SEC) initiated proceedings against Terraform Labs, the maker of the failed TerraUSD stablecoin, in February 2023.
Later, on September 12, Terraform Labs attempted to subpoena three companies under the Genesis umbrella: Genesis Global Capital, Genesis Global Holdco and Genesis Global Trading. The subpoena required Genesis to provide the relevant information by October 9.
Genesis apparently failed to comply with this, as the judge’s latest order shows that Genesis failed to produce the relevant documents or even respond to the subpoena at all. The order says the court can enforce the subpoena since both the court and Genesis’ offices are in the same district of New York. The latest order states that Genesis must produce the relevant documents within five days of service of the order.
The specific information requested through the subpoena has yet to be made public. It’s also not clear how Terraform Labs and Genesis were involved. Terraform Labs has also attempted to subpoena other parties, including FTX and Michael Arrington.
Genesis and Terraform have experienced failures
Each company has experienced significant failures while remaining partially operational. Terraform Labs dissolved its Korean offices in 2021, months before TerraUSD lost virtually all of its value. Terraform Labs nevertheless managed to avoid bankruptcy.
Genesis’ lender filed for bankruptcy in January 2023. Although Genesis’ other divisions remained operational, the company announced in September that it would soon discontinue all trading services. It is unclear to what extent Genesis’ various divisions are still operational and providing other services.
Although the current case involves an SEC complaint against Terraform Labs, the SEC filed a separate case against Genesis in January. Genesis tried to dismiss that case in May but was unsuccessful.
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