It’s not often that a defendant will label a $100 million dollar judgment against him as a “victory,” but it’s a surprising result of current cryptocurrency courtroom disputes. It was precisely the label Craig Wright attached to a jury’s award earlier this month in the action filed against him by Ira Kleiman, the brother of Wright’s business partner David Kleiman.
Anonymous Bitcoin Creator Unmasked?
Why would a $100 million dollar award be considered a victory? Because the plaintiff here was seeking an award of half of 1.1 million Bitcoin (BTC), a potentially staggering sum, worth well over $50 billion. But just as interesting is the theory behind the recovery. Wright has long claimed to be Satoshi Nakamoto, the still anonymous creator of Bitcoin, and Nakamoto, or some other very early Bitcoin miner, has a stash of 1.1 million BTC, created at the initial stages of Bitcoin mining, and untouched since. Wright’s claims have long been doubted, and Wright has not produced any firm evidence of his claim, but interestingly both parties took the position that Wright is Nakamoto in presenting their cases. Whether Wright is Nakamoto, a claim for which Wright has never put forth any evidence, was not actually an issue before the jury.
Plaintiff’s Attorneys Fail to Establish Early Partnership
So why isn’t Mr. Kleiman coming home with half of 1.1 million Bitcoin? Putting aside the issue of whether Wright is Nakamoto, Plaintiff still had to establish that Wright and David Kleiman had a partnership related to the creation of Bitcoin or the initial stages of Bitcoin mining. Based on the jury’s verdict, it appears that Plaintiff’s attorneys failed to do so. What they did establish, however, was that there was a joint venture, W&K Information Defense Research LLC, which was involved in the creation of software that helped make blockchain and cryptocurrency technologies possible. The fruits of those efforts entitled Plaintiff to $100 million.
Trial Just the Start of This Story
However, Plaintiff has another problem waiting in the wings. There are other members of W&K Information Defense Research LLC, including Wright’s ex-wife and his current wife, who dispute Kleiman’s ownership interests in that enterprise and his right to bring suit on that enterprise’s behalf. Depending on how those disputes play out, Kleiman’s recovery could be reduced even further. Those disputes are currently playing out in Palm Beach County court.
And then there is the question of how Wright will pay the $100 million verdict. Will it involve liquidation of BTC? And will it involve litigation of part of the 1.1 million BTC at issue in this matter? One can only guess what effect the liquidation of about 2,000 of those original BTC would have on crypto markets. As is usually the case after trial, the story is far from over.
The attorneys at Dressel/Malikschmitt LLP are experienced litigators in the cryptocurrency and blockchain spaces. If you would like to contact one of our attorneys, please reach out via email at email@example.com, call at 848.202.9323, or visit our website www.d-mlaw.com.
Disclaimer: Please note that any legal question requires consideration of individual facts, and this article is not intended as legal advice to any individual or business and should not be relied upon as such.