- Justin Sun is seeking sanctions against World Liberty Financial, alleging the project amended its corporate disclosures to reveal UAE ties only to escape US federal court jurisdiction.
- Sun invested $30 million in WLFI tokens, later increasing his stake to $45 million, before suing the project in April 2026.
- A federal court ruled that some of Sun’s personal claims must remain public, prompting WLF’s UAE disclosure and an attempt to shift jurisdiction.
- Sun plans to refile in California state court and wrote on X that WLF “discovered its UAE roots only when it needed a way out of an American federal courtroom.”
Sun’s $45M Investment Turns Litigation
After initially investing $30 million in the project’s WLFI governance tokens. He later raised his stake to $45 million in World Liberty Financial, founded by Justin Sun — the founder of Tron in 2025, the crypto project backed by the Trump family became embroiled in legal proceedings when Sun filed a lawsuit in April 2026. He claimed that the principals of WLF committed fraudulent acts, froze his assets and acted in an extortionate manner. At the time of the lawsuit, Sun claimed it was “on the verge of collapse”.
UAE Disclosure & Jurisdiction Maneuver
Following a ruling by a US federal court that some of Sun’s individual claims need to be made public, World Liberty Financial updated their disclosures.
Last night, my lawyers moved to sanction World Liberty Financial @worldlibertyfi for failing to disclose, until months into my litigation against the company, that it is a citizen of the UAE 🇦🇪 . #WLFI #USD1
For those who are new to this dispute, I was one of World Liberty’s earliest and largest investors. In November 2024, I agreed to buy $30 million of $WLFI tokens under a Token Purchase Agreement with World Liberty, and I later increased my total investment to $45 million.
In April, I sued World Liberty, alleging that the company induced my investment through fraud and then unlawfully froze my tokens.
My Token Purchase Agreement gives me the right to bring my claims in either California federal or state court.
I chose federal court.
Federal courts can hear a case like mine only when the two sides come from different places. Foreign plaintiffs like me can sue an American defendant in federal court, but foreign plaintiffs generally cannot sue a foreign defendant there. For these purposes, a company like World Liberty takes on the citizenship of each of its owners, so a single foreign owner makes the company foreign.
In other words, so long as World Liberty and all of its owners were American, my case could be heard in federal court.
The federal court’s rules required World Liberty to file a disclosure at the start of the case identifying every one of its owners and where each is a citizen. World Liberty’s disclosure identified only one entity—World Liberty itself—and listed Florida as its sole citizenship. Its lawyers certified that they were unaware of anyone else who needed to be disclosed.
World Liberty then moved to compel arbitration, seeking to pull my case out of open court and into secret arbitration proceedings.
I opposed that motion, and my lawyers spent months and hundreds of thousands of dollars fighting it. At a hearing in August, the Court signaled that it was not persuaded that my claims belonged in arbitration. Instead, the Court ruled that certain of my claims should stay in open court, and certain claims should be sent to arbitration, and ordered the parties to meet and confer to come up with a proposed agreement on which claims stay in open court and which ones go to arbitration.
Less than a week later, World Liberty suddenly “corrected” its disclosure. Where it had previously listed only one member in its ownership chain, it now listed 22, and claimed citizenship in Florida, Delaware, Puerto Rico, and the UAE.
World Liberty now says that the federal court has no jurisdiction over my case, since its UAE citizenship means there are foreign parties on both sides of the case.
The irony is hard to miss. World Liberty’s gold paper declares that “[b]y design, World Liberty Financial is not organized offshore,” and that it is “an American, tax-paying, corporation that aims to bring DeFi to its rightful home—America.” It promises a “US-based decentralized platform” built on “American ideals of liberty, privacy, and freedom to transact,” calls private, intermediary-free transactions “a core American value,” and boasts that “[r]ather than shying away from the United States, World Liberty Financial embraces the United States as the future CRYPTO CAPITAL OF THE PLANET.”
World Liberty was proudly American 🇺🇸 when it was selling tokens. It discovered its UAE 🇦🇪 roots only when it needed a way out of an American federal courtroom.
World Liberty presumably always knew who its owners were. Its lawyers claim that they learned about the company’s UAE citizenship only after they filed the original disclosure.
As my motion explains, if that is true, then either World Liberty’s lawyers failed to conduct appropriate diligence, or World Liberty did not give its lawyers a straight answer. When we asked how this happened, World Liberty refused to tell us.
Token holders deserve to know whether the projects they invest in are telling the truth, both to the public and to courts. I am filing this motion to hold World Liberty and its lawyers accountable for what I believe was a misleading disclosure to the Court, and to make sure that the cost of World Liberty’s gamesmanship falls on them, not on me.
And after my sanctions motion is resolved in federal court, I will re-file my lawsuit against World Liberty in California state court.
I will keep fighting for the transparency this community deserves.
— H.E. Justin Sun 👨🚀 🌞 (@justinsuntron) November 3, 2026
As Sun claims, this was a calculated move to try and take the case out of the US federal courts as he was making headway with his claims. Sun claims that they knew about the UAE connections for a while but decided to keep it quiet until they wanted to get out of the legal situation.
Sanctions Motion & California Refiling
He is now seeking sanctions against World Liberty Financial as they acted in bad faith when updating their disclosures. Sun will also refile his claims in California state court. He claims that even though they have now revealed their UAE connections, this does not mean that he cannot bring US based claims. In an X post he said “WLF discovers its roots in UAE only when they need an escape from the American Federal Courtroom. Obviously, they are hiding behind geography.
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