South Korean law firm to file lawsuit against Terraform Labs CEO

LKB & Partners intends to prosecute Do Kwon over the collapse of the UST stablecoin rate

18.05.2022 - 15:00

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What’s new? South Korean law firm LKB & Partners intends to file a lawsuit against Terraform Labs CEO Do Kwon on behalf of retail investors. This was reported by the Korean media, citing a statement from the company. Several LKB & Partners’ employees who lost their investments as a result of the TerraUSD (UST) stablecoin value collapse may join the class action.

Information from the Korean media

What other actions will the company take? In addition to the lawsuit, LKB representatives also intend to file a complaint with the Financial Investigation Unit of the Seoul Metropolitan Police Agency. The company’s employees demand that Kwo’s property be seized, filing a corresponding complaint to the Public Prosecutors’ Office of Seoul Southern District.

What events happened before? South Korean authorities called for a parliamentary hearing on TerraUSD following the collapse of the stablecoin rate. A representative from South Korea’s ruling People Power Party Yoon Chan-Hyun said that Do Kwon should speak to parliament and explain the reasons behind what happened. One of the purposes of the hearing is to take measures to protect investors.

On May 16, Do Kwon proposed to the community to conduct a network hard fork to restore the Terra ecosystem, but users rejected this initiative as a result of a preliminary vote.

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