Montenegro blocks Do Kwon extradition again following successful appeal Montenegro blocks Do Kwon extradition again following successful appeal
Terraform Labs and its former CEO Do Kwon legal battles in the US and Montenegro continues with new developments afoot.
2 min read
Updated: Mar. 5, 2024 at 5:51 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Terraform Labs co-founder Do Kwon’s extradition to the US was annulled by the Appellate Court of Montenegro, according to a Mar. 5 notice on the Court’s website.
This development occurs amid bankrupt Terraform Labs’ recent legal wrangle with the US SEC.
Why was Kwon’s extradition annulled?
According to the Court, the High Court of Podgorica’s decision to allow Kwon to be extradited to the US for criminal prosecution violated the country’s criminal procedure provisions.
Another argument central to Kwon’s successful appeal was the determination of extradition priority. Despite Kwon’s preference for South Korea, the High Court in Podgorica ruled in favor of an extradition to the US. This decision was based on the precedence of the US extradition request, which was received a day earlier than South Korea’s request.
However, the Appellate Court challenged this ruling. It pointed out that the US temporary detention request arrived on Mar. 27, 2023, after South Korea’s extradition request. South Korea’s request had been communicated via emails on Mar. 24, 2023, and Mar. 26, 2023 — preceding the formal request on Mar. 28, 2023.
As such, the appeals court determined that the case should be returned to the Court of first instance for retrial.
Kwon’s extradition has dragged on for several months, with both the US and South Korea seeking trials within their jurisdiction. Authorities in both countries want Kwon to answer for his role in the collapse of Terra’s algorithmic UST stablecoin, which wiped over $40 billion from the crypto industry.
Terraform Labs slam SEC’s overreach
The SEC recently opposed Terraform Labs’ $166 million payment to Dentons, contending that the firm shouldn’t engage the law firm or cover legal expenses for employees amidst bankruptcy proceedings.
In a March 4 filing, Terraform Labs responded to the SEC’s opposition to the $166 million retainer fee paid to law firm Dentons.
The bankrupt crypto firm criticized the SEC’s objection as an instance of government overreach. It also asserted that the regulator’s move aimed to disrupt proceedings before trial.
According to the firm:
“The SEC’s objection, framed as a creditor concern, is a pretext for its true motive: to disadvantage and distract an adversary on the eve of trial.”
The firm urged the court to dismiss the SEC’s objections, citing them as containing legal misinterpretations and factual inaccuracies.
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Terraform Labs
Terraform Labs is a startup that created Terra, a blockchain protocol and payment platform used for algorithmic stablecoins.
Do Kwon began his professional journey as an engineer, contributing to tech giants Apple and Microsoft.