Justin Sun: Court rejects WLFI's secret arbitration request, the claim case will continue with a public hearing

Justin Sun posted on social media that his legal team recently attended a hearing at the U.S. District Court for the Central District of California, opposing World Liberty Financial (WLFI)’s attempt to refer their dispute to confidential arbitration and seal documents from public view. The court upheld Sun’s position, ruling that all his individual claims will proceed in open court. The court also rejected World Liberty’s request that all company-related claims be submitted to arbitration, and ordered both parties to negotiate to determine which claims will remain in court and which will go to arbitration. Sun called the ruling a "major victory", noting that token holders have the right to know how the project team handles investor interests. Justin Sun stated that he is one of the earliest and largest investors in World Liberty, having invested $45 million in WLFI tokens. He alleged that after his investment helped WLFI complete approximately $550 million in fundraising, World Liberty inserted a backdoor into the WLFI smart contract, allowing the project team to unilaterally freeze, restrict, or destroy holders’ tokens. World Liberty had taken related actions against his WLFI tokens and threatened to refer the matter to criminal authorities when he sought legal recourse. Sun’s current claims against World Liberty amount to hundreds of millions of dollars. Additionally, Justin Sun said he learned that World Liberty has similar functions in its USD1 stablecoin, warning users to be alert to potential asset freezing or destruction permissions. Sun also raised questions about World Liberty’s financial status and business arrangements, stating that public information shows World Liberty has deposited approximately 5 billion WLFI tokens as collateral on lending platform Dolomite, borrowing at least $75 million in stablecoins including USD1. He believes these arrangements may pose risks.