The legal dispute between Justin Sun and World Liberty Financial (WLFI) has escalated again. He said his legal team has asked a federal court to sanction WLFI. The main reason: months after the lawsuit began, WLFI suddenly disclosed that a UAE citizen was part of its ownership chain.
According to Sun, he signed a token purchase agreement in November 2024, initially investing $30 million, later increased to $45 million. In April this year, he sued WLFI, alleging that it induced his investment through fraud and unlawfully froze his tokens.
The initial disclosure documents in the case listed only one entity registered in Florida in the ownership chain. WLFI had also sought to compel arbitration. But at an August hearing, the court expressed doubts about the arbitration claim and allowed some claims to proceed publicly. Less than a week later, WLFI suddenly “corrected” its filing, changing the number of ownership members from 1 to 22 and claiming they included individuals from Florida, Delaware, Puerto Rico, and the UAE. It then argued that the federal court lacked jurisdiction because both sides had foreign parties.
Sun criticized WLFI, saying that when selling tokens, it emphasized that it was “a U.S. company that pays taxes in the United States,” but only remembered its UAE ties when it wanted to escape federal court. He said that after the federal court rules on the sanctions motion, he will refile the lawsuit in California state court.
The key issue in this dispute is no longer just an investment disagreement. It also concerns whether crypto projects selectively shift their claimed identities during litigation and use that to delay proceedings. Whether the court grants the sanctions request remains worth watching.
#孙宇晨 #WLFI #CryptoLawsuit
According to Sun, he signed a token purchase agreement in November 2024, initially investing $30 million, later increased to $45 million. In April this year, he sued WLFI, alleging that it induced his investment through fraud and unlawfully froze his tokens.
The initial disclosure documents in the case listed only one entity registered in Florida in the ownership chain. WLFI had also sought to compel arbitration. But at an August hearing, the court expressed doubts about the arbitration claim and allowed some claims to proceed publicly. Less than a week later, WLFI suddenly “corrected” its filing, changing the number of ownership members from 1 to 22 and claiming they included individuals from Florida, Delaware, Puerto Rico, and the UAE. It then argued that the federal court lacked jurisdiction because both sides had foreign parties.
Sun criticized WLFI, saying that when selling tokens, it emphasized that it was “a U.S. company that pays taxes in the United States,” but only remembered its UAE ties when it wanted to escape federal court. He said that after the federal court rules on the sanctions motion, he will refile the lawsuit in California state court.
The key issue in this dispute is no longer just an investment disagreement. It also concerns whether crypto projects selectively shift their claimed identities during litigation and use that to delay proceedings. Whether the court grants the sanctions request remains worth watching.
#孙宇晨 #WLFI #CryptoLawsuit