Tron founder Justin Sun is seeking $263,821.20 in sanctions against World Liberty Financial and its lawyers, alleging the Trump family-linked crypto venture submitted a misleading court disclosure about its UAE ownership to support a jurisdiction challenge in a dispute over Sun's $45 million WLFI token investment.
Key Takeaways
- Justin Sun seeks $263,821.20 in sanctions over World Liberty's delayed disclosure of 22 owners including UAE entities
- World Liberty amended citizenship disclosure three months after initial filing, six days after judge questioned arbitration bid
- Dispute centers on Sun's $45M WLFI token investment; Abu Dhabi vehicle agreed to buy 49% stake for $500M in Jan 2025
- Dec. 10 hearing scheduled on sanctions motion; Sun plans California state court refiling afterward
- World Liberty's defamation countersuit against Sun remains active
Executive Intelligence Brief
Disclosure Timeline and Jurisdiction Challenge
In a federal court filing, Sun and two co-plaintiffs alleged that World Liberty initially listed Florida as its sole citizenship when the lawsuit was filed in April 2025. Nearly three months later, World Liberty amended its disclosure to identify 22 individuals and entities in its ownership chain, including parties in the United Arab Emirates. The amended disclosure came six days after a federal judge questioned World Liberty's bid to move Sun's claims into arbitration.
World Liberty's lawyers subsequently argued that the company's UAE citizenship deprived the federal court of jurisdiction because foreign parties were on both sides of the lawsuit. In an Aug. 26 email included in court exhibits, World Liberty's lawyer Sam Cleveland said his team had 'recently' learned of additional citizenship information, maintaining that World Liberty already had UAE citizenship when Sun filed the lawsuit.
Background: $45 Million Investment and Abu Dhabi Stake
The legal dispute stems from Sun's April 2025 lawsuit alleging fraud and the unlawful freezing of his $45 million WLFI token investment. World Liberty filed a defamation countersuit in May, alleging false statements and violations of token-sale terms, which Sun denied. The back-and-forth followed a January 2025 agreement by an Abu Dhabi-backed investment vehicle to purchase a 49% stake in World Liberty for $500 million.
Sun previously backed the Trump family's crypto ventures by investing in World Liberty and buying President Donald Trump's TRUMP memecoin. He topped the token's leaderboard for a May 2025 dinner with Trump, with holdings valued at about $18.5 million.
Sanctions Motion Details
According to attorney Edward Moss's sworn declaration, the $263,821.20 request covers fees for four attorneys' work opposing arbitration. It excludes other lawyers' fees and costs related to jurisdictional discovery and the sanctions motion itself. Sun's lawyers sought corporate records and testimony about World Liberty's ownership and when its attorneys learned of the UAE connection, alleging that World Liberty provided limited documentation but declined to explain why its original disclosure omitted that information.
Forward Outlook: State Court Refiling and Pending Countersuit
Sun said he plans to refile his token-freeze lawsuit in California state court after the sanctions motion is resolved. A hearing on the sanctions motion is scheduled for Dec. 10. World Liberty's defamation countersuit against Sun remains pending. World Liberty Financial did not immediately respond to requests for comment.
