SEC Expands Jurisdiction over Justin Sun in TRX, BTT Securities Case

The SEC has amended its complaint against Justin Sun and other defendants, asserting personal jurisdiction over them due to Sun's frequent visits to the US from 2017 to 2019. During these visits, Sun allegedly promoted and sold BTT and TRX tokens without proper registration. The SEC contends that Sun's physical presence and business activities in the US establish "personal jurisdiction."

SEC Strengthens Jurisdiction over Justin Sun in Tron, BitTorrent Securities Case

Washington, D.C. - April 19, 2023 - The United States Securities and Exchange Commission (SEC) has filed an amended complaint against Justin Sun, founder of the Tron Foundation, and other defendants in its ongoing case alleging the illegal sale of unregistered securities. The amended complaint strengthens the SEC's jurisdiction over the defendants, arguing that Sun's frequent visits to the US and his direct dealings with US-based entities justify the SEC's authority to take legal action.

According to the SEC's amended complaint, filed on April 18th, Sun made numerous trips to the US between 2017 and 2019 to promote and sell the Tron (TRX) and BitTorrent (BTT) tokens for the Tron and BitTorrent Foundations, respectively. The SEC alleges that Sun spent over 380 days in the US during this period, visiting major cities such as New York City, Boston, and San Francisco.

The SEC contends that Sun's extensive physical presence in the US, coupled with his active engagement in promoting and selling TRX and BTT tokens to US investors, establishes "personal jurisdiction" over him and the companies he controls. The regulator also highlights Sun's alleged communication with and provision of documents to the US-based cryptocurrency exchange Bittrex to list TRX in 2018 as further evidence of his direct connection to the US.

These new allegations directly address Sun's motion to dismiss the SEC's lawsuit in March, which argued that the SEC lacked personal jurisdiction over him and the other defendants. Sun's defense lawyers had asserted that Sun, as a foreign national, was not "at home" in the US and that the companies involved were not "doing business" in the country.

The SEC's amended complaint presents a strong case for jurisdiction, countering Sun's arguments by demonstrating his significant ties to the US and his active efforts to market and sell TRX and BTT tokens to US investors. The amended complaint also refutes Sun's claims that the SEC's lawsuit is an overreach, arguing that the SEC has authority to enforce US securities laws against foreign entities that target US investors.

The SEC's determination to assert jurisdiction over Justin Sun and the other defendants signals the agency's commitment to protecting US investors from fraud and misconduct in the cryptocurrency market. The case is being closely watched by industry observers as a precedent-setting battle between the SEC and a major player in the global cryptocurrency ecosystem.

The next hearing in the case is scheduled for May 26th, 2023, in the US District Court for the Southern District of New York.