Wednesday, 28 February 2018 07:42

Australian bitcoin 'creator' hit with US$10b lawsuit Featured

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An Australian who has claimed to be the founder of bitcoin has been hit with a US$10 billion lawsuit by the estate of one of his early collaborators.

Craig Wright has been sued by the estate of David Kleiman, with the lawsuit alleging that soon after Kleiman's death, Wright stole between 550,000 and 1.1 million bitcoins and other intellectual property owned by W&K Info Defense Research, a Florida company which Kleiman owned.

The suit claims that the bitcoin allegedly appropriated by Wright are worth US$10.2 billion and seeks return of these bitcoins. (More documents here.)

It said that while it was unclear whether Wright or Kleiman created bitcoin, both were involved at an early stage and accumulated a vast number of bitcoin between 2009 and 2013.

Kleiman died in April 2013. The lawsuit alleges that Wright had a plan to seize Kleiman's bitcoins and the rights to certain IP associated with the bitcoin technology.

"As part of this plan, Craig forged a series of contracts that purported to transfer Dave’s assets to Craig and/or companies controlled by him. Craig backdated these contracts and forged Dave’s signature on them," the plaint says.

It claims that soon after Kleiman died, his brother, Ira, was told by Wright that while he and Kleiman had partnered to create bitcoin, all the property rights had been signed away to him "in exchange for non-controlling share of a non-operational Australian company worth 'millions'. Craig told Ira he’d be able to sell Dave’s stake in the company in a few months".

The lawsuit said the company had gone bankrupt after Wright allegedly misled the Australian Taxation Office, after which he had left for London.

"Since fleeing to London, Craig has lived a life of fame and fortune. In May 2016, he publicly revealed himself as the alleged creator of Bitcoin," the suit claimed.

"He currently serves as chief scientist of nChain, a UK company purporting to be the global leader in research and development of blockchain technologies. He also regularly posts pictures to his social media accounts of his lavish lifestyle."

The lawsuit was filed on 14 February and gives a detailed history of bitcoin and also of Kleiman's life.

It says that on 8 December 2015, tech publications Wired and Gizmodo claimed Wright was Satoshi Nakamoto, the creator of bitcoin. Wright made the claim himself in a blog post on 2 May 2016. This claim has been questioned.

The lawsuit also cites emails between Wright and Ira to argue its case and claims that signatures allegedly made by Kleiman on some contracts are forgeries and generated by a computer-generated font.

The case has been filed by Velvel Freedman and Kyle Roche of Boies Schiller Flexner.

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Sam Varghese

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Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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