Photo: WTO / Jessica Genoud (CC BY-SA 2.0; archive crop)
Tron founder Justin Sun is asking a court to sanction Trump-linked World Liberty Financial and its lawyers, alleging that the crypto venture failed to disclose United Arab Emirates ownership ties until months into his lawsuit over frozen tokens tied to a $45 million investment. The allegations are disputed, and no sanctions have been imposed in the reports.
The request adds a new procedural fight to the lawsuit Sun filed in April, rather than a new frozen-token lawsuit. CoinDesk’s Helene Braun reported at 11:55am EST Tuesday that Sun accused World Liberty of concealing its UAE ties. The Block’s Jason Shubnell separately reported the sanctions request at 11:08am EST.
Ownership disclosure at the center of the dispute
According to Sun’s account, cited by both outlets, World Liberty initially identified only itself in its ownership chain and listed Florida as its sole citizenship in the California federal court case. It later amended the disclosure to identify 22 entities in that chain and claim citizenship in Florida, Delaware, Puerto Rico and the UAE.
Sun says the change came after an August hearing at which a judge ruled that some claims could remain in public court while others should go to private arbitration. He alleges the company should have disclosed its foreign ownership earlier, before his lawyers spent months and hundreds of thousands of dollars opposing its arbitration request, CoinDesk reported.
The citizenship question matters because it could affect whether the federal court has authority to hear the dispute. World Liberty is arguing that its UAE citizenship prevents the case from proceeding there, according to CoinDesk. The Block reported that a company’s owners’ citizenship can affect federal diversity jurisdiction.
World Liberty’s lawyers said they learned of the UAE citizenship after the original disclosure was filed, according to Sun’s account in CoinDesk. The court has not found that the company intentionally concealed its ownership, and the sanctions request does not establish wrongdoing.
Frozen-token fight remains unresolved
Sun initially agreed to buy $30 million in WLFI tokens in November 2024, then increased his investment to $45 million, CoinDesk reported. He alleges World Liberty induced that investment through fraud and later unlawfully froze his holdings. Those are allegations in the existing dispute, not court findings.
World Liberty previously defended its decision to freeze Sun’s tokens and could not be reached by CoinDesk for comment on the latest allegations. The Block reported that the company countersued Sun in May, accusing him of a “meritless PR stunt” against the Trump-family-backed project.
Sun says he plans to refile his lawsuit in California state court after the sanctions motion is resolved, according to both outlets. That is a stated next step, not a completed refiling or a ruling returning the tokens to him.
The latest development concerns disclosure, jurisdiction and the costs of litigation. Neither report describes an order imposing sanctions, a finding that World Liberty concealed ownership intentionally, or a final decision on Sun’s underlying fraud and token-freeze claims.
JBizNews Desk | New York
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