In a recent development, the Supreme Court of Montenegro has heard an important decision in the legal battle surrounding Do Kwon, co-founder of Terraform Labs. On Friday, the court overturned an earlier decision to extradite Kwon to South Korea, his native country. This case, which has been riveting international legal circles for months now, has taken a new twist, according to several reports.

The case has been sent back to a lower court

The demand for Kwon’s extradition has been submitted not only by South Korea, but also by the United States. Both countries have previously received favorable decisions from Montenegrin courts regarding their requests. However, these decisions have now been overturned by the Supreme Court and the case has been sent back to a lower court for further review. The Supreme Court has emphasized that the final decision on an extradition request lies with the Minister of Justice of Montenegro.

Kwon faces fraud charges in both South Korea and the U.S. in connection with Terra Luna’s 2022 demise, an event that wiped out its market value of about $60 billion. His arrest took place at Podgorica Airport in Montenegro, where he was caught trying to leave the country with a fake Costa Rican passport bound for Dubai.

Complex legal situation

In addition to his attempt to travel with forged documents, for which Kwon has already served a prison sentence in Montenegro, he finds himself in a complex legal situation. Despite his release last month, local authorities withheld his passport to prevent him from leaving the country pending further legal proceedings over his extradition.

In parallel, a jury in New York federal court found Terraform Labs and Kwon liable for civil fraud for misleading investors prior to the Terra Luna crash. This statement follows allegations by the US Securities and Exchange Commission regarding misleading information about the risks associated with their stablecoin. Penalties for this civil fraud case will be considered by District Judge Jed Rakoff.


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