By Mark Hunter
1 hour agoMon Mar 18 2024 10:02:59
Reading Time: 4 minutes
Craig Wright’s defeat to COPA could be costly in more ways than one
Wright asked for many other cases to be wrapped up into the COPA trial, risking defeat on all counts
Having lost, Wright faces defeat in these cases and has risked all the other outstanding ones
Craig Wright’s defeat to COPA in the Satoshi trial last week brought an end to his decade-long cosplay, but the impact could be far more serious for him. Wright himself pushed for several other existing cases to be bound up in the result of the ‘identity issue’ with which COPA dealt, cases which are now almost certain to be kicked out. There are also other cases not directly linked to the identity issue trial but which could see Wright defeated before they even get to court, leaving him facing millions in costs at a time when he can least afford it.
Passing Off Cases
Wright sued Kraken and Coinbase in May 2022, alleging they misrepresented Bitcoin by selling his forked version, BSV, under the BTC ticker. He is seeking recognition for BSV as Bitcoin, alongside a staggering £500 billion ($636 billion) in damages. Kraken and Coinbase both filed responses claiming that Wright was not Satoshi Nakamoto, and Wright was ordered to pay over $500,000 in security costs to continue the case, but only if he won against COPA on the identity issue.
Having lost the identity issue, Kraken and Coinbase will now file to have the cases dismissed and are certain of victory.
Copyright Cases
There are three other cases related to the passing off cases, collectively called the copyright cases. These suits target various Bitcoin developers and companies such as Coinbase, Blockstream, and Square and are, again, aimed at asserting that Wright has a legal copyright over Bitcoin as its creator, a copyright that developers and exchanges are infringing.
These cases concern three specific elements: the rights to the Bitcoin database, use and distribution of the Bitcoin whitepaper, and the Bitcoin file structure. Wright was allowed to carry these cases forward following an appeal victory over the file format issue, but seeing as these cases are also predicated on his identity as Bitcoin’s creator they, too, are ripe for dismissal.
Tulip Trading vs Bitcoin Developers
This case, filed in 2021, was the result of what Craig Wright says is the biggest heist in British history, alleging that the prior year £1.1 billion ($1.4 billion) worth of BTC, BCH, and BSV was stolen from him. This was despite the coins never actually moving, with Wright claiming that the private keys were stolen in an audacious physical hack of his systems. The British police have never made this claim public, however, perhaps telling us all we need to know on this front.
Wright sued a collection of developers from the blockchains concerned, claiming that they owed him a fiduciary duty over the coins and that he wanted them back. The case was initially dismissed but Wright won on appeal, meaning the case would be tried in court. However, last year Justice Mellor ruled that Wright would first have to prove he owned the coins before the case would see a full trial.
This is where the problems start to mount for Wright. This case is not directly tied to the identity issue as it is not based on Wright being Satoshi, but it is Wright’s contention that he (through his companies) held the coins, today worth around $8 billion, something that the developers dispute. Unfortunately for Wright, key accounting records in the Tulip Trading case were brought into the COPA vs. Wright trial as an example of Wright’s forgery, and if Justice Mellor rules that the records were indeed forged and the Tulip Trust does not exist, then this would be terminal for the Tulip Trading case.
On the plus side, Wright may get some of the $400,000 he had to put up as security costs if the case is dismissed prior to this preliminary ‘trial’, so every cloud.
Hodlonaut Libel Trials
Wright is also facing Hodlonaut in two jurisdictions, the UK and Norway, stemming from libel charges brought against the Norwegian in 2019. Hodlonaut won the Norway trial in 2022 but Wright was afforded an appeal, which essentially means the trial will be held again. The UK case made little headway before both sides agreed to stay all action pending the outcome of the COPA vs. Wright case, which Wright has now of course lost.
Wright’s defeat doesn’t mean that these cases are struck out because Hodlonaut could still theoretically be found to have defamed Wright with his comments despite Wright being found not to be Satoshi. However, if Wright does continue with the action then he will have to do so with the not inconsiderable handicap of having courts in both countries ruling that he is not Satoshi Nakamoto.
Satoshi Naka-nomoney?
Overall then, Wright’s defeat to COPA is much more damaging than a lone confirmation that he isn’t Satoshi. At a time when he still owes W&K Info Defense $143 million over the Kleiman vs. Wright affair and Hodlonaut expenses from their trial, he could be on the hook for millions more in costs if his other connected cases are kicked.
Wright could also face a legal challenge over the 2019 awarding of Bitcoin whitepaper copyright by the US Copyright Office, the action which kicked off his legal spree, a legal spree which may have come to a financially and reputationally ruinous end.
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