Justin Sun Seeks Sanctions Against World Liberty Financial Over Undisclosed UAE Ties
Justin Sun alleges World Liberty Financial hid foreign ownership
Justin Sun, the founder of the Tron blockchain, is asking a court to sanction World Liberty Financial and its lawyers. Sun claims the crypto project, which has ties to President Donald Trump, failed to disclose its connections to the United Arab Emirates (UAE) for several months. Sun originally sued the company in April over $45 million in frozen tokens.
Sun alleges that World Liberty Financial only revealed its UAE ties after a judge ruled that parts of the lawsuit could proceed in public court. This new information could prevent the case from continuing in federal court, as these courts often cannot hear cases involving foreign citizens on both sides.
Key details of the dispute
- Justin Sun invested a total of $45 million into World Liberty Financial.
- The lawsuit alleges fraud and the unlawful freezing of WLFI tokens.
- World Liberty Financial updated its disclosure to include 22 entities across the UAE, Florida, Delaware, and Puerto Rico.
- Sun plans to move the case to a California state court.
What the court filings and disclosures show
According to Sun, World Liberty Financial initially told a California federal court that it was a citizen of Florida. After an August hearing, the company amended its filing to include its UAE citizenship. Sun argues the company should have disclosed this from the start.
Sun claims his lawyers spent months and hundreds of thousands of dollars fighting the company's request for private arbitration before the UAE ties were mentioned. He stated on social media that the company only discovered its UAE roots when it needed to leave a federal courtroom.
Facts of the investment and legal action
Sun was one of the earliest and largest investors in World Liberty Financial. He initially agreed to buy $30 million worth of tokens in November 2024 before increasing the amount. World Liberty Financial is a decentralized finance project—a platform that uses blockchain technology to offer financial services without traditional middlemen—and is closely linked to the Trump family.
The relationship between Sun and the project collapsed when Sun alleged the company used fraud to get his investment. He also claims the project froze his assets, preventing him from using the tokens he purchased.
Unresolved questions in the case
It remains unclear if World Liberty Financial intentionally hid its ownership structure. Lawyers for the company have stated they only learned of the UAE citizenship after the original disclosure was filed. The court has not yet made a decision regarding Sun's request for sanctions.
Impact on the legal proceedings
The disclosure of foreign ownership is significant because it challenges the federal court's jurisdiction. If the court determines it cannot hear the case due to the UAE ties, the current legal process in federal court will stop. This would force the legal battle to restart in a different court system.
Next steps for the lawsuit
Sun has announced his intention to refile the lawsuit in California state court. This move will likely happen once the motion for sanctions against World Liberty Financial and its legal team is resolved.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.