The Securities and Exchange Commission (SEC) asserts that Justin Sun's purported stays in the United States between 2017 and 2019, totaling more than 380 days, along with his business trips to key cities like New York City, Boston, Massachusetts, and San Francisco, provide the basis for pursuing legal action.

In an amended complaint filed on April 18, the SEC contends that Sun's alleged visits to the US grant the necessary jurisdiction for legal proceedings against him and other involved parties. The regulator claims that during these visits, Sun extensively traveled to the US while engaging in unregistered offers and sales of BTT and TRX tokens through various companies.

The SEC aims to leverage Sun's time spent in the US, conducting business trips on behalf of the Tron Foundation and the BitTorrent Foundation, both co-defendants in the case, to establish jurisdiction for regulatory and legal actions within the US.

Wash Trading Allegations

Accusations of wash trading have been leveled against Sun and the implicated companies, specifically on the now-defunct crypto exchange Bittrex. While the initial complaint highlighted similar wash trading activities, it only referred to the exchange as an unnamed "trading platform."

The SEC's amended complaint explicitly mentions Bittrex's US base, reinforcing its argument for personal jurisdiction over Sun and the other defendants. Additionally, it alleges that Sun personally engaged with Bittrex in 2018 to facilitate the listing of TRX, providing documents and signing some paperwork linking him to the companies involved.

Response to Dismissal Request

Addressing Sun's dismissal request in March, citing lack of personal jurisdiction due to his foreign nationality and non-residency in the US, the latest allegations counter these claims. Sun's defense argued against the SEC's jurisdiction, emphasizing the absence of US residents purchasing TRX on the unidentified platform where improper distributions were alleged.

The SEC initiated legal action against Sun and the other defendants in March 2023, primarily focusing on jurisdiction claims related to investor targeting in the Southern District of New York and interactions with US individuals through social media by celebrity promoters. In a separate case, the SEC sued Bittrex in April 2023, reaching a settlement by August 2023, after which the company ceased global operations towards the end of the same year.