SEC Strengthens Grip on Tron Founder Justin Sun in Amended Lawsuit

The SEC has filed an amended lawsuit against Tron founder Justin Sun, claiming that he has personal jurisdiction over him. The SEC claims that Sun traveled extensively in the US during the period under review and that Sun and his businesses also took actions toward the US. This gives the SEC enough "personal jurisdiction" over Sun, Tron, and two other businesses linked to him.

SEC Strengthens Jurisdiction over Tron Founder Justin Sun in Amended Suit

New York, NY - The United States Securities and Exchange Commission (SEC) has filed an amended lawsuit against Tron founder Justin Sun, bolstering its claims of personal jurisdiction and further establishing the SEC's authority to pursue enforcement actions against him and his businesses.

The revised complaint alleges that Sun, a Chinese-born Grenadian citizen, "purposefully took actions in and directed toward the United States," giving the SEC jurisdiction over him, the Tron Foundation, and two other entities linked to him. The SEC's investigation revealed that Sun spent over 380 days in the US between 2017 and 2019, visiting major cities such as Boston, San Francisco, New York City, and Massachusetts while conducting business for Tron and its affiliates.

The SEC maintains that during these visits, Sun and his businesses engaged in activities that directly targeted American investors, including the sale of unregistered securities through the Tron (TRX) and BitTorrent (BTT) tokens. The filing further alleges that Sun manipulated the trading of TRX on the Seattle-based crypto exchange Bittrex through "wash trading," a practice that artificially inflates the token's price.

These allegations are in addition to those made in the SEC's original lawsuit, which accuses Sun and his businesses of selling unregistered securities and misleading investors about the value and operation of Tron and BitTorrent.

In response to Sun's request to dismiss the initial complaint, the SEC argues that US securities laws extend to foreign conduct that has a substantial impact on American investors. The regulator emphasizes that the Tron and BitTorrent tokens were accessible to US investors through exchanges such as Bittrex and that Sun's extensive travel and business activities in the US establish sufficient personal jurisdiction.

As of publication, neither Sun nor his lawyers have publicly commented on the amended suit. However, Sun has previously defended his actions, claiming that the tokens were sold "entirely overseas" with efforts to avoid the US market. He has also argued that the SEC lacks jurisdiction over him or the Singapore-based Tron Foundation.

The SEC's amended lawsuit sends a clear message that it will aggressively pursue enforcement actions against those who violate US securities laws, regardless of their location. The regulator's ability to assert jurisdiction over foreign actors who target American investors is a critical step in protecting the integrity of the US financial markets and ensuring that all market participants play by the same rules.