The US Securities and Exchange Commission (SEC) has settled its civil fraud case against Tron (TRX) blockchain founder Justin Sun, bringing an end to the legal proceedings that began in 2023.
As part of the settlement, one of Justin Sun’s companies will pay a $10 million civil penalty, and the regulator will drop its claims against Sun and several related entities.
Justin Sun Case’s End
The SEC originally filed its lawsuit in March 2023 against Sun and his companies, including the Tron Foundation, BitTorrent Foundation, and Rainberry. The agency alleged that Sun and the corporate defendants orchestrated the unregistered offer and sale of TRX and BitTorrent’s BTT.
Additionally, the regulator — chaired at the time by the heavily criticized Gary Gensler — accused them of inflating trading volumes artificially and concealing payments made to celebrity endorsers who promoted the tokens.
According to a court filing made public on Thursday, the settlement includes a permanent injunction against Rainberry. The company is barred from violating key Securities Acts in connection with the offer or sale of securities.
That provision prohibits engaging in transactions or business practices that operate as a fraud or deceit on purchasers, including conduct that creates a false appearance or misleads investors about the price or trading market of a security.
SEC Finalizes Settlement
The filing further orders Rainberry to pay a $10 million civil penalty. At the same time, the SEC agreed to dismiss with prejudice all claims against Justin Sun, the Tron Foundation, and the BitTorrent Foundation.
The regulator’s dismissal also covers all remaining claims against Rainberry in the case, with no additional costs or fees imposed.
Despite Justin Sun and his firms winning in court, Tron’s native token, TRX, has failed to capitalize on this legal development, remaining at around $0.28 at the time of writing.
Featured image from Bloomberg, chart from TradingView.com
