World Liberty Financial filed a defamation lawsuit against Tron founder Justin Sun on Monday. The complaint accuses Sun of running a paid smear campaign to crash the WLFI token.
The Trump-linked Decentralized Finance (DeFi) project says Sun used press, influencers, and bots to amplify false claims after the freeze of his tokens. Sun has rejected the suit and called it a meritless PR stunt.
Court Filing Alleges Drive-to-Zero Campaign
The complaint was filed in the Eleventh Judicial Circuit Court for Miami-Dade County, Florida. World Liberty Financial is seeking unspecified damages and a public retraction from Sun.
The company says Sun’s posts were designed to suppress WLFI’s market price. The token traded near $0.06 on Monday, up by almost 12% in the last 24 hours.
World Liberty Financial said in its filing announcement that Sun openly stated his intent to harm the project.
“Sun’s lies were designed, in his own words, to drive the token price ‘to shit,'” WLFI wrote on X
Token Freeze Triggered the Public Feud
The dispute began after WLFI used its on-chain controls to lock Sun-linked wallets in September 2025. The project froze 540 million unlocked tokens and 2.4 billion locked WLFI held by Sun’s entities.
World Liberty Financial said Sun’s vehicle, Blue Anthem, transferred tokens to Binance against his investor agreement. The company argues those transfers, plus alleged short selling, justified the freeze.
Sun previously invested $30 million in WLFI and later raised his stake to roughly $75 million.
He filed his own lawsuit in California federal court in late April, alleging fraud and breach of contract.
Smart Contract Controls at the Center of the Fight
The two sides disagree on whether WLFI’s freeze authority was clearly disclosed to investors. Sun has argued the project hid a blacklist function inside its smart contract.
World Liberty Financial counters that the freeze authority was outlined in its Terms of Sale and in Sun’s purchase agreements. The project says its governance process is community-driven and transparent.
WLFI’s price has slumped since the freeze became public last fall. The token is now down more than 75% from its all-time high.
According to Justin Sun, the lawsuit announced Monday is WLFI’s PR stunt, with the Tron executive calling it “meritless.”
The competing lawsuits leave WLFI investors watching two parallel cases. Filings in the coming weeks will test whether the freeze function was contractually disclosed. They will also test whether Sun’s posts crossed into defamation.
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