WLFI Drama Escalates: World Liberty Sues Justin Sun Over ‘Reckless’ Smear Campaign

In the latest development of the fight between World Liberty Financial (WLFI) and Justin Sun, the Trump Family-backed company has filed a defamation complaint against the crypto founder for his alleged smear campaign to harm the project and its token’s price.

WLFI Strikes Back With Defamation Suit

On Monday, World Liberty Financial filed a defamation lawsuit against Tron founder Justin Sun in the Eleventh Judicial Circuit Court for Miami-Dade County, Florida, seeking both damages and a public retraction of the statements Sun published on X to his nearly four million followers.

According to the announcement, the lawsuit alleges that the crypto billionaire had engaged in a “deliberate campaign to publish false and defamatory statements” about the company via public posts Sun published to his large social media following.

“Sun’s posts impugn World Liberty, a Florida-based decentralized finance company, and its governance integrity and business relationships, causing substantial and ongoing harm to World Liberty,” the complaint reads.

In mid-April, Sun began an online dispute against World Liberty, accusing the project of embedding a backdoor blacklisting function in the smart contract used to deploy WLFI tokens, later calling the project a “World Tyranny” over its controversial governance proposal.

On April 22, the Tron founder escalated the online feud into a court battle by filing a complaint against the WLFI. Sun alleged that World Liberty’s team froze his tokens, stripped him of his voting rights, and threatened to burn his holdings, without proper justification.

Notably, he claimed that his relationship with WLFI’s team soured in mid-2025 after he declined to provide additional investment and support to the project, specifically the USD1 stablecoin. He also affirmed that World Liberty privately blamed him for the token’s 40% price crash during its September launch, and that he tried to resolve the situation privately but has “no choice but to turn to the courts.”

World Liberty Financial co-founders Eric Trump and Zack Witkoff publicly responded to Justin Sun’s lawsuit, dismissing the complaint and discrediting him. In an X post, Witkoff, who is the son of Trump Middle East envoy Steve Witkoff, called the lawsuit a “desperate attempt to deflect attention” from Sun’s alleged “misconduct” and announced that WLFI would “take all necessary steps to protect its community.”

Sun Accused Of Reckless Lies, Extortion Threats

World Liberty’s Monday filing addressed the main claims of Sun’s lawsuit, alleging that the project “did not engage in wrongful blacklisting of Sun’s token wallet.” The complaint argues that Sun had engaged in prohibited transfers, straw purchases, and short sales of WLFI, which led to the token freeze.

It further claims that Sun was fully aware and agreed to WLFI’s freezing authority, as the freeze function is “spelled out in World Liberty’s Terms of Sale, in the Token Unlock Agreement that Sun signed, and on the public blockchain itself.”

Therefore, the lawsuit alleges that despite his knowledge of the project’s governing agreements and public disclosures, the crypto billionaire “acted with reckless disregard for the truth, and that he did so in a calculated effort to harm World Liberty while potentially benefiting his own financial positions.”

Lastly, World Liberty claims that Sun threatened the company before going public. The filing alleges that he “threatened to ‘light World Liberty on fire’ and cause the $WLFI token price to ‘go to shit’ if World Liberty did not accede to Sun’s demands to pay him hundreds of millions of dollars.”

“Rather than acting in good faith, Justin Sun chose to defame World Liberty — repeatedly, publicly, and to millions of followers. World Liberty filed this lawsuit as a last resort to correct the record and to protect its token holders, its employees, and all its stakeholders. We are eager to expose the falsity of Sun’s statements in court and in public,” said Tom Clare, attorney for World Liberty Financial in the press release.

In an X post, Sun responded to the lawsuit, calling it “nothing more than a meritless PR stunt.” The Tron founder affirmed that he stands by his actions and “look[s] forward to defending the case in court.”