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Do Kwon sentenced to 15 years in prison for $40 billion stablecoin fraud
Class Action |
2025/12/11 22:16
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Onetime cryptocurrency mogul Do Kwon was sentenced Thursday to 15 years in prison after a $40 billion crash revealed his crypto ecosystem to be a fraud. Victims said the 34-year-old financial technology whiz weaponized their trust to convince them that the investment — secretly propped up by cash infusions — was safe.
Kwon, a Stanford graduate known by some as “the cryptocurrency king,” apologized after listening as victims — one in court and others by telephone — described the scam’s toll: wiping out nest eggs, depleting charities and wrecking lives. One told the judge in a letter that he contemplated suicide after his father lost his retirement money in the scheme.
Judge Paul A. Engelmayer said at a daylong sentencing hearing in Manhattan federal court that the government’s recommendation of 12 years in prison was “unreasonably lenient” and that the defense’s request for five years was “utterly unthinkable and wildly unreasonable.” Kwon faced a maximum sentence of 25 years in prison.
“Your offense caused real people to lose $40 billion in real money, not some paper loss,” Engelmayer told Kwon, who sat at the defense table in a yellow jail suit. The judge called it “a fraud on an epic, generational scale” and said Kwon had an “almost mystical hold” on investors and caused incalculable “human wreckage.”
Kwon pleaded guilty in August to fraud charges stemming from the collapse of Terraform Labs, the Singapore-based firm he co-founded in 2018. The loss exceeded the combined losses from FTX founder Sam Bankman-Fried and OneCoin co-founder Karl Sebastian Greenwood’s frauds, prosecutors said. Engelmayer estimated there may have been a million victims.
Terraform Labs had touted its TerraUSD as a reliable “stablecoin” — a kind of currency typically pegged to stable assets to prevent drastic fluctuations in prices. But prosecutors say it was an illusion backed by outside cash infusions that came crumbling down after it plunged far below its $1 peg. The crash devastated investors in TerraUSD and its floating sister currency, Luna, triggering “a cascade of crises that swept through cryptocurrency markets.”
Kwon tried to rebuild Terraform Labs in Singapore before fleeing to the Balkans on a false passport, prosecutors said. He’s been locked up since his March 2023 arrest in Montenegro. He was credited for 17 months he spent in jail there before being extradited to the U.S.
Kwon agreed to forfeit over $19 million as part of his plea deal. His lawyers argued his conduct stemmed not from greed, but hubris and desperation. Engelmayer rejected his request to serve his sentence in his native South Korea, where he also faces prosecution and where his wife and 4-year-old daughter live.
“I have spent almost every waking moment of the last few years thinking of what I could have done different and what I can do now to make things right,” Kwon told Engelmayer. Hearing from victims, he said, was “harrowing and reminded me again of the great losses that I have caused.”
One victim, speaking by telephone, said his wife divorced him, his sons had to skip college, and he had to move back to Croatia to live with his parents after TerraUSD’s crash evaporated his family’s life savings. Another said he has to “live with the guilt” of persuading his in-laws and hundreds of nonprofit organizations to invest.
Stanislav Trofimchuk said his family’s investment plummeted from $190,000 to $13,000 — “17 years of our life, gone” during what he described as “two weeks of sheer terror.”
Chauncey St. John, speaking in court, said some nonprofits he worked with lost more than $2 million and a church group lost about $900,000. He and his wife are saddled with debt and his in-laws have been forced to work well past their planned retirement, he said.
Nevertheless, St. John said, he forgives Kwon and “I pray to God to have mercy on his soul.”
A prosecutor read excerpts from some of more than 300 letters submitted by victims, including a person identified only by initials who lost nearly $11,400 while juggling bills and trying to complete college. Kwon had made Terra seem like a safe place to stash savings, the person said.
“To some that is just a number on a page, but to me it was years of effort,” the person wrote. “Watching it evaporate, literally overnight, was one of the most terrifying experiences of my life.”
“What happened was not an accident. It was not a market event. It was deception,” the person added, imploring the judge to “consider the human cost of this tragedy.”
Kwon created an “illusion of resilience while covering up systemic failure,” Assistant U.S. Attorney Sarah Mortazavi told Engelmayer. “This was fraud executed with arrogance, manipulation and total disregard for people.”
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Top EU official warns the US against interfering in Europe’s affairs
Breaking Legal News |
2025/12/07 06:16
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A top European Union official on Monday warned the United States against interfering in Europe’s affairs and said only European citizens can decide which parties should govern them.
European Council President Antonio Costa’s remarks came in reaction to the Trump administration’s new national security strategy, which was published on Friday and paints European allies as weak while offering tacit support to far-right political parties.
It’s “good” that the strategy depicts European countries as an ally, but “allies don’t threaten to interfere in the domestic political choices of their allies,” Costa said.
“What we can’t accept is the threat of interference in European political life. The United States cannot replace European citizens in choosing what the good or the bad parties are,” he said in Paris at the Jacques Delors Institute, a think tank.
Fabian Zuleeg, chief executive at the European Policy Centre think tank, said that stridently nationalist parties in Europe will be emboldened by the strategy document and “will intensify efforts to hollow out the EU from within.”
“Pro-European liberal forces need to finally wake up: Trump’s America is not an ally but an adversary to Europe’s freedoms and fundamental values. His objective is to replace our democratic system with the illiberal populism now entrenched in the U.S.,” Zuleeg said.
The strategy was also critical of European free speech and migration policy. U.S. allies in Europe face the “prospect of civilizational erasure,” the document said, raising doubts about their long-term reliability as American partners.
But Costa, who chairs summits of the 27 national EU leaders, said Europe’s “history has taught us that you can’t have freedom of speech without freedom of information.”
The former Portuguese prime minister also warned “there will never be free speech if the freedom of information of citizens is sacrificed for the aims of the tech oligarchs in the United States.”
Speaking to reporters in Berlin, German government spokesperson Sebastian Hille underlined that “Europe and the U.S. are historically, economically and culturally linked, and remain close partners.”
“But we reject the partly critical tones against the EU,” he said. “Political freedoms, including the right to freedom of expression, belong to the fundamental values of the European Union. We view accusations regarding this more as ideology than strategy.”
The security strategy is the administration’s first since President Donald Trump returned to office in January. It breaks starkly from the course set by President Joe Biden’s Democratic administration, which sought to reinvigorate U.S. alliances.
It comes as the U.S. seeks an end to Russia’s nearly 4-year-old war in Ukraine, a goal that the national security strategy says is in America’s vital interests.
But the text makes clear that the U.S. wants to improve its relationship with Russia after years of Moscow being treated as a global pariah and ending the war is a core U.S. interest to “reestablish strategic stability with Russia.”
Kremlin spokesman Dmitry Peskov has said the document “absolutely corresponds to our vision.” Over the course of the war, Russia has worked to drive a wedge between NATO allies, particularly between the U.S. and Ukraine’s main backers in Europe.
“If we read closely the part about Ukraine, we can understand why Moscow shares this vision,” Costa said. “The objective in this strategy is not a fair and durable peace. It’s only (about) the end of hostilities, and the stability of relations with Russia.”
“Everyone wants stable relations with Russia,” he added, but “we can’t have stable relations with Russia when Russia remains a threat to our security.”
Top EU officials and intelligence officers have warned Russia could be in a position to launch an attack elsewhere in Europe in three to five years should it defeat Ukraine. |
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Former Honduras President Hernández freed after Trump pardon
Breaking Legal News |
2025/12/02 22:11
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Former Honduras President Juan Orlando Hernández, sentenced last year to 45 years in prison for his role in helping drug traffickers move hundreds of tons of cocaine to the United States, was released from prison following a pardon from President Donald Trump, his wife announced Tuesday.
The U.S. Bureau of Prisons inmate website showed that Hernández was released from U.S. Penitentiary, Hazelton in West Virginia on Monday and a spokesperson for the bureau on Tuesday confirmed his release.
His wife Ana García thanked Trump for pardoning Hernández via the social platform X early Tuesday.
“After almost four years of pain, of waiting and difficult challenges, my husband Juan Orlando Hernández RETURNED to being a free man, thanks to the presidential pardon granted by President Donald Trump,” García’s post said. She included a picture of the U.S. Bureau of Prisons listing for Hernández indicating his release.
On Sunday, Trump was asked about why he pardoned Hernandez by reporters traveling with him on Air Force One.
“I was asked by Honduras, many of the people of Honduras,” Trump said.
“The people of Honduras really thought he was set up, and it was a terrible thing,” he said.
“They basically said he was a drug dealer because he was the president of the country. And they said it was a Biden administration set-up. And I looked at the facts and I agreed with them.”
Hernández was arrested at the request of the United States in February 2022, weeks after handing over power to current President Xiomara Castro.
Two years later, he was sentenced to 45 years in prison in a New York federal courtroom for taking bribes from drug traffickers so they could safely move some 400 tons of cocaine north through Honduras to the United States.
Hernández maintained throughout that he was innocent and the victim of revenge by drug traffickers he had helped extradite to the United States.
During his sentencing in New York, federal Judge P. Kevin Castel said the punishment should serve as a warning to “well educated, well dressed” individuals who gain power and think their status insulates them from justice when they do wrong.
Hernández portrayed himself as a hero of the anti-drug trafficking movement who teamed up with American authorities under three U.S. presidential administrations to reduce drug imports.
But the judge said trial evidence proved the opposite and that Hernández employed “considerable acting skills” to make it seem that he was an anti-drug trafficking crusader while he deployed his nation’s police and military, when necessary, to protect the drug trade.
Hernández is not guaranteed a quick return to Honduras.
Immediately after Trump announced his intention to pardon Hernández, Honduras Attorney General Johel Zelaya said via X that his office was obligated to seek justice and put an end to impunity.
He did not specify what charges Hernández could face in Honduras. There were various corruption-related investigations of his administration across two terms in office that did not lead to charges against him. President Xiomara Castro, who had Hernández arrested and extradited him to the U.S., will remain in office until January.
The pardon promised by Trump days before Honduras’ presidential election injected a new element into the contest that some said helped the candidate from his National Party Nasry Asfura, one of the leaders as the vote count proceeded Tuesday.
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Supreme Court meets to weigh Trump’s birthright citizenship restrictions
Biotech |
2025/11/28 22:12
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The Supreme Court is meeting in private Friday with a key issue on its agenda — President Donald Trump ’s birthright citizenship order declaring that children born to parents who are in the United States illegally or temporarily are not American citizens.
The justices could say as soon as Monday whether they will hear Trump’s appeal of lower court rulings that have uniformly struck down the citizenship restrictions. They have not taken effect anywhere in the United States.
If the court steps in now, the case would be argued in the spring, with a definitive ruling expected by early summer.
The birthright citizenship order, which Trump signed on the first day of his second term in the White House, is part of his administration’s broad immigration crackdown. Other actions include immigration enforcement surges in several cities and the first peacetime invocation of the 18th century Alien Enemies Act.
The administration is facing multiple court challenges, and the high court has sent mixed signals in emergency orders it has issued. The justices effectively stopped the use of the Alien Enemies Act to rapidly deport alleged Venezuelan gang members without court hearings, while they allowed the resumption of sweeping immigration stops in the Los Angeles area after a lower court blocked the practice of stopping people solely based on their race, language, job or location.
The justices also are weighing the administration’s emergency appeal to be allowed to deploy National Guard troops in the Chicago area for immigration enforcement actions. A lower court has indefinitely prevented the deployment.
Birthright citizenship is the first Trump immigration-related policy to reach the court for a final ruling. Trump’s order would upend more than 125 years of understanding that the Constitution’s 14th Amendment confers citizenship on everyone born on American soil, with narrow exceptions for the children of foreign diplomats and those born to a foreign occupying force.
In a series of decisions, lower courts have struck down the executive order as unconstitutional, or likely so, even after a Supreme Court ruling in late June that limited judges’ use of nationwide injunctions.
While the Supreme Court curbed the use of nationwide injunctions, it did not rule out other court orders that could have nationwide effects, including in class-action lawsuits and those brought by states. The justices did not decide at that time whether the underlying citizenship order is constitutional.
But every lower court that has looked at the issue has concluded that Trump’s order violates or most likely violates the 14th Amendment, which was intended to ensure that Black people, including former slaves, had citizenship.
The administration is appealing two cases.
The U.S. Court of Appeals for the 9th Circuit in San Francisco ruled in July that a group of states that sued over the order needed a nationwide injunction to prevent the problems that would be caused by birthright citizenship being in effect in some states and not others.
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Court official dismisses Justice Department’s misconduct complaint
Business |
2025/11/22 22:16
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A court official has dismissed a Justice Department complaint that accused a federal judge of “hostile and egregious” misconduct during hearings for a lawsuit challenging President Donald Trump’s ban on transgender troops serving in the military.
The complaint accused U.S. District Judge Ana Reyes in Washington, D.C., of inappropriately questioning a government lawyer about his religious beliefs and of trying to embarrass the attorney with a rhetorical exercise during a February hearing.
In a Sept 29 order that wasn’t made public until Monday, Chief Judge Sri Srinivasan of the U.S. Court of Appeals for the District of Columbia Circuit dismissed the complaint. Srinivasan said a motion for Reyes’ recusal would have been the proper means for the Justice Department to contest her impartiality and seek her removal from the case.
The department didn’t explicitly ask for Reyes’ removal from the transgender troops’ litigation. And it didn’t file a petition for a review of the chief judge’s order, which didn’t reach any conclusions about the merits of the complaint’s allegations.
“If a party that believes a judge’s conduct in a case raises serious questions about her impartiality were to press its concerns in the ordinary way — by seeking her recusal in the case itself — the standards for resolving the matter are well established,” Srinivasan wrote.
The Justice Department had no immediate comment on Tuesday. Reyes declined to comment on the chief judge’s order or the department’s complaint.
The complaint was filed by Attorney General Pam Bondi’s then-chief of staff, Chad Mizelle, who has since left the department. Mizelle claimed Reyes’ behavior “compromised the dignity of the proceedings and demonstrated potential bias.”
“When judges demonstrate apparent bias or treat counsel disrespectfully, public confidence in the judicial system is undermined,” he wrote.
Mizelle’s complaint cited an exchange in which Reyes asked a government attorney: “What do you think Jesus would say to telling a group of people that they are so worthless, so worthless that we’re not going to allow them into homeless shelters? Do you think Jesus would be, ‘Sounds right to me’?” The attorney responded by saying, “The United States is not going to speculate about what Jesus would have to say about anything.”
The complaint also refers to a rhetorical exercise about discrimination. Reyes spoke of changing the rules in her courtroom to bar graduates of the University of Virginia law school from appearing before her because they are all “liars and lack integrity.” She instructed the government attorney, a graduate of the school, to sit down before calling him back up to the podium.
Reyes was nominated to the bench by President Joe Biden, a Democrat. Trump and Republican allies have mounted an escalating series of attacks against the federal judiciary since the start of his second term.
Trump’s Jan. 27 executive order claims without presenting evidence that the sexual identity of transgender service members “conflicts with a soldier’s commitment to an honorable, truthful, and disciplined lifestyle, even in one’s personal life” and is harmful to military readiness. It required Defense Secretary Pete Hegseth to issue a revised policy.
Six transgender people who were active-duty service members and two other plaintiffs seeking to join the military sued to challenge Trump’s order. Reyes blocked the order’s enforcement in March, ruling that it likely violates the plaintiffs’ constitutional rights. A federal judge in Washington state also blocked enforcement of the order.
Reyes agreed to suspend her order pending the government’s appeal, which hasn’t been resolved yet. But the U.S. Supreme Court has allowed the Trump administration to ban transgender people from the military in the meantime. |
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S. Carolina lawmakers look at the most restrictive abortion bill in the US
Breaking Legal News |
2025/11/18 05:39
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A bill that would allow judges to sentence women who get abortions to decades in prison and could restrict the use of IUDs and in vitro fertilization goes before a small group of South Carolina senators Tuesday.
This would be the first of at least a half-dozen legislative steps for the proposal that includes the strictest abortion prohibitions and punishments in the nation.
The subcommittee of the state Senate’s Medical Affairs Committee can change it Tuesday afternoon and even if it’s approved, its prospects are doubtful at best.
But even at this stage, the bill has gone further than any other such proposal across the U.S. since the Supreme Court overturned Roe v. Wade in 2022, opening the door for states to implement abortion bans.
The proposal would ban all abortions unless the woman’s life is threatened. Current state law bans abortions after cardiac activity is detected, which is typically six week into a pregnancy, before many women know they are pregnant. Current law also allows abortions for rape and incest victims up to 12 weeks.
The proposal would also do things that aren’t being done in any other state. Women who get an abortion and anyone who helps them could face up to 30 years in prison. It appears to ban any contraception that prevents a fertilized egg from implanting, which would ban intrauterine devices and could limit in vitro fertilization.
Providing information about abortions would be illegal, leaving doctors worried they couldn’t suggest places where the procedure is legal.
Republican Sen. Richard Cash, who sponsors the bill and is one of the Senate’s most strident voices against abortion, will run Tuesday’s subcommittee. He acknowledged problems last month with potentially banning contraception and restricting the advice doctors can give to patients. But he has given no indication what changes he or the rest of the subcommittee might support. Six of the nine members are Republicans.
Abortion remains an unsettled issue in conservative states and how much more to restrict it is fracturing anti-abortion groups.
South Carolina Citizens for Life, one of the state’s largest and oldest opponents of abortion, issued a statement last month saying it can’t support Cash’s bill because women who get abortions are victims too and shouldn’t be punished.
On the other side, at least for this bill, are groups like Equal Protection South Carolina. “Abortion is murder and should be treated as such,” founder Mark Corral said. |
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Longest government shutdown in US history ends after 43 days
Business |
2025/11/13 07:21
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President Donald Trump signed a government funding bill Wednesday night, ending a record 43-day shutdown that caused financial stress for federal workers who went without paychecks, stranded scores of travelers at airports and generated long lines at some food banks.
Before signing the legislation, Trump said the government should never shut down again, adding, “This is no way to run a country.”
Trump’s signature draws to a close the second government shutdown he’s overseen in the White House, one that magnified the partisan divisions in Washington as his administration took unprecedented unilateral actions -- including canceling projects and trying to fire federal workers -- to pressure Democrats into relenting on their demands.
The signing ceremony came just hours after the House passed the measure on a mostly party-line vote of 222-209. The Senate had already passed the measure Monday.
In lengthy remarks before affixing his name, Trump said, “It’s an honor now to sign this incredible bill.”
He said the government should never shut down again, adding, “This is no way to run a country.”
Trump was surrounded in the Oval Office by Republican lawmakers and some former members of Congress who are now heading powerful business lobbying groups.
His signature drew applause, but Trump didn’t answer questions on the Epstein scandal or any other topic before the press was hustled out.
Trump signed the government funding bill Wednesday night, drawing to a close the second government shutdown he’s overseen in the White House.
The signing ceremony came just hours after the House passed the measure on a mostly party-line vote of 222-209. The Senate had already passed the measure Monday.
Congress has taken a major step toward reopening the government, but there’s still uncertainty about when all 42 million Americans who receive SNAP food aid will have access to their full November benefits.
One provision in the bill that would reopen the government calls for restarting the Supplemental Nutrition Assistance Program, but even that doesn’t resolve when the benefits will be loaded onto the debit cards beneficiaries use to buy groceries.
A spokesperson for the U.S. Department of Agriculture, which runs the program, said in an email Wednesday that funds could be available “upon the government reopening, within 24 hours for most states.” The department didn’t immediately answer questions about where it might take longer. |
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Class action or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued. This form of collective lawsuit originated in the United States and is still predominantly a U.S. phenomenon, at least the U.S. variant of it. In the United States federal courts, class actions are governed by Federal Rules of Civil Procedure Rule. Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions. Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions. They can construct your law firm a brand new website and help you redesign your existing law firm site to secure your place in the internet. |
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