Judge Failla’s ruling emphasized that the government only needs to prove that Storm knew he was handling proceeds from a crime.
Roman Storm, co-founder of Tornado Cash, will face trial on money laundering charges on December 2 in New York.
This is after U.S. District Judge Katherine Polk Failla rejected his motion to dismiss three charges brought against him by the U.S. Department of Justice. (DOJ)
Judge Rejects Roman Storm’s Defense
During a remote hearing on September 26, Judge Failla ruled against Storm, who had argued that his involvement in Tornado Cash was limited to writing the software code and that he had no control over how the tool was subsequently used.
According to DeFi Education Fund’s Chief Legal Officer Amanda Tuminelli, who shared details from the hearing on X, “the court rejected the arguments in Storm’s motion to dismiss as a matter of law and heavily punted what she said were factual issues for trial.”
She explained that the judge dismissed his claims on the basis that control over illicit activities was not required for the charges to hold. She added that Failla emphasized the government’s burden was to prove that the Tornado Cash developer knew he was handling proceeds from a crime, not that he conspired with users to further criminal activities.
The court also contended that Storm’s state of mind and, therefore, knowledge of potential criminal dealings should be a matter for a jury to decide. Judge Failla further mentioned that the statutes in question had provided him sufficient notice that his conduct could be considered criminal despite the unconventional nature of the technology he used.
Jake Chervinsky Condemns Ruling in Case
Meanwhile, Jake Chervinsky, Chief Legal Officer at Variant Fund, voiced concerns on X, calling the ruling “an assault on the freedom of software developers everywhere.” He described the decision as “a perversion of law and a travesty of justice.”
Storm and fellow Tornado Cash developer Roman Semenov were charged with three key offenses: conspiracy to commit money laundering, conspiracy to operate an unlicensed money-transmitting business, and conspiracy to violate the International Emergency Economic Powers Act (IEEPA).
In August 2023, the DOJ claimed that the crypto mixing service knowingly facilitated illegal transactions, including funds linked to the North Korean Lazarus Group.
Storm, who has pleaded not guilty to all charges, will now prepare for a trial in December that is expected to last two weeks. However, Semenov remains at large.
Tuminelli concluded by noting that although the judge did not issue a formal written opinion, she is expected to provide a “bottom line” ruling on the docket, likely to avoid setting a precedent that other courts could reference.