Sun Accuses World Liberty of Using UAE Ties to Evade Federal Court

Nationality Becomes Key in Justin Sun’s Legal Battle with Crypto Firm

Justin Sun’s legal dispute with World Liberty Financial is now centered on a question of nationality, with the Tron founder alleging the Trump family-backed cryptocurrency venture deliberately obscured its ties to the United Arab Emirates to manipulate the court.

Sun stated on X, formerly Twitter, on Tuesday that his legal team has urged a federal court in California to penalize World Liberty Financial for the delayed disclosure of its ownership structure, which he claims grants the company citizenship in the UAE. Sun asserts he is one of World Liberty’s earliest and most significant investors, having agreed in November 2024 to purchase $30 million in its WLFI tokens, later increasing his total investment to $45 million.

He filed a lawsuit against the company in April, accusing it of misleading him into investing and subsequently freezing his tokens unlawfully. World Liberty Financial has countered in court, alleging that Sun engaged in short-selling WLFI, thereby driving down its price.

The core of the current contention lies in a technical legal point. Sun initiated his lawsuit in federal court, which typically handles cases involving parties from different jurisdictions but generally cannot adjudicate claims brought by a foreign plaintiff against a foreign defendant.

As Sun explained, a company’s legal “citizenship” is determined by that of its owners, meaning a single foreign owner can render the entire company foreign for jurisdictional purposes. Sun contends that World Liberty Financial’s initial court filing identified itself as the sole entity with Florida as its only citizenship. A judge indicated during an August hearing that some of Sun’s claims should proceed in open court rather than through arbitration.

Less than a week later, Sun claims, the company amended its disclosure to include 22 individuals within its ownership chain, with citizenships in Florida, Delaware, Puerto Rico, and the UAE. World Liberty Financial is now arguing that the federal court lacks jurisdiction over the case, according to Sun.

Sun maintains that this delayed disclosure was a strategic maneuver to remove the case from federal court. His motion seeks to hold World Liberty Financial and its legal representatives accountable for the associated costs. He contrasted the company’s current stance with its public marketing, sharing excerpts from World Liberty’s “gold paper” that describe it as “an American, tax-paying, corporation.”

Once the sanctions motion is resolved, Sun announced his intention to refile his lawsuit in California state court. “I will keep fighting for the transparency this community deserves,” he wrote.

The public feud has been ongoing for months, with Sun criticizing World Liberty Financial’s treatment of investors and alleging the company threatened to destroy his WLFI tokens.