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Judge Blocks SEC’s Effort to Weaken Tron’s Defense in Securities Case

A New York District Judge has rejected the SEC’s attempt to undermine the defense of Tron founder Justin Sun, permitting his case for dismissal to move forward. The judge ruled that Sun’s motion to dismiss was valid and did not present any new arguments.

A New York District Judge has delivered a blow to the Securities and Exchange Commission (SEC) in its ongoing legal battle against Tron founder Justin Sun. On August 19, U.S. District Court Judge Edgardo Ramos rejected the SEC’s attempt to undermine one of Sun’s key defenses in his bid to dismiss the case.

Sun’s defense argued that the SEC lacks jurisdiction over foreign digital asset offerings sold to non-U.S. purchasers on global platforms, and it sought to have the case dismissed in April. The SEC claimed that this was a new argument, raised by Sun’s defense in an attempt to challenge the SEC’s case. In response, Sun’s legal team countered that they were not introducing any new arguments and that the SEC was attempting to manufacture a controversy to weaken their defense.

They emphasized that their challenge to the SEC’s claims was based on the belief that the tokens were sold entirely outside the United States and did not involve U.S. investors. Judge Ramos sided with Sun’s defense, stating that the defendants had not introduced any new arguments and had made it clear they were not disputing the “common enterprise” element of the Howey test. As a result, the judge denied the SEC’s request to strike the defense’s argument or to file an additional response. This ruling allows Sun’s motion to dismiss the case to proceed, marking a significant victory for the Tron founder as the legal battle continues. The SEC’s broader effort to apply U.S. securities laws to global digital asset transactions remains a central issue in the ongoing case.

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