Tornado Cash Dev Roman Storm’s Criminal Case Will Proceed to Trial, NY Judge Orders

The U.S. Department of Justice’s (DOJ) case against Tornado Cash developer Roman Storm will proceed to trial, a New York judge ruled during a telephonic hearing on Thursday.

District Judge Katherine Polk Failla of the Southern District of New York (SDNY) denied Storm’s motion to dismiss the criminal charges against him, saying his arguments about free speech, not receiving sufficient notice that he may be breaking the law and Tornado Cash's operations didn't hold enough water to overcome the DOJ's complaint, and that the government had brought plausible allegations against the developer.

“At this stage in the case, this court cannot simply accept Mr. Storm's narrative that he is being prosecuted merely for writing code,” Failla said. “If the jury ultimately accepts this narrative, then it will acquit. But there's no basis for me to decide that as a matter of law.”

Both Storm and his supporters have argued that to be prosecuted for writing code would be akin to being prosecuted for speech, suggesting that coding should be protected by the First Amendment of the U.S. Constitution. But Failla didn’t buy it, saying “The functional capability of code is not speech within the meaning of the First Amendment.”

"The Court finds that the government has a substantial interest in promoting a secure financial system by combating money laundering, by combating the operation of unregistered money transmitting services and by combating the evasion of sanctions," she said. "These interests are wholly unrelated to the suppression of free expression, and the applicability of these laws to destroy conduct does not burden substantially more speech than necessary."

Failla also said that she didn’t think that Tornado Cash was “meaningfully different” from other money transmitting businesses or financial institutions, and that the service was not “an altruistic venture," pointing to allegations that a venture capital fund provided financing in exchange for future profits, the relayer feature and the role of TORN tokens.

Along with fellow Tornado Cash developer Roman Semenov, Storm was indicted last August on three charges tied to their work with the privacy mixer – conspiracy to commit money laundering, conspiracy to operate an unlicensed money transmitting business, and conspiracy to violate the International Emergency Powers Act (i.e. violating international sanctions).

Prosecutors have accused Tornado Cash and its developers of “knowingly” facilitating the laundering of more than $1 billion, including “hundreds of millions” from North Korea’s infamous hacking organization, the Lazarus Group.

Storm has pleaded not guilty to all charges. In his motion to dismiss filed in March, Storm’s lawyers argued that he simply wrote Tornado Cash’s code – anything criminal that subsequently happened with that code, they said, was out of his hands.

During Thursday’s hearing, Failla argued that, under the law, it didn’t matter whether Storm knew about the criminal uses of Tornado Cash.

“Now, the law is clear, but to be guilty of money laundering, the defendants need not be guilty of, involved in, or even aware of the specifics of the specified unlawful activity,” Failla said. “The government did not have to allege that Mr. Storm was aware of the specific nature of, much less a participant in, the underlying criminal activity.”

Read more: Conduct vs. Code May Be the Defining Question in Roman Storm Prosecution

Failla also denied another of Storm’s pending motions in the case – a motion to compel the DOJ to produce the defense with documents from Dutch authorities, who recently convicted another Tornado Cash developer, Alexey Pertsev, of money laundering.

Storm's team had not demonstrated that the material from Dutch authorities would be relevant, the judge ruled, calling his arguments too "speculative."

"Of course the defense argues that because it does not know what's in those materials, it must couch its description in terms like 'may,'" she said. "There must be some showing that the MLAT materials are in fact, and not just in theory, relevant to the [case]."

Storm’s trial is currently set to begin in New York on Dec. 2, and is expected to last two weeks. If convicted on all three counts, he faces a maximum potential sentence of 45 years in prison.

UPDATE (Sept. 26, 2024, 21:50 UTC): Adds additional detail.