World Liberty files Justin Sun defamation lawsuit over WLFI freeze and transfer claims

World Liberty Financial (WLFI) has filed a defamation lawsuit in Florida against Tron founder Justin Sun, escalating claims tied to WLFI token transfer restrictions and alleged market-impacting statements. In the complaint, WLFI says Sun made false public statements and violated WLFI token-sale terms through allegedly prohibited actions, including short-selling and “straw purchases.” WLFI also seeks a court-ordered retraction and damages, arguing Sun previously agreed to WLFI’s right to freeze tokens to protect holders. The new filing follows an earlier dispute in which Sun sued World Liberty after WLFI froze his WLFI tokens. WLFI now adds that Sun’s WLFI address was blacklisted in September 2025 after platforms flagged an estimated $9 million transfer, and that Sun already knew WLFI had freezing authority. The case also highlights governance concentration: a March vote reportedly showed 76% of voting power controlled by 10 wallets. Market context: WLFI trading data shows a single-day move of roughly +5% (another report cited ~+12% on the initial filing day), but the token remains down over 80% since launch. For traders, the WLFI defamation lawsuit increases uncertainty around WLFI custody/freeze mechanics and counterparty risk tied to major on-chain stakeholders. Expect headline-driven volatility in the short term; longer-term direction may hinge on court developments and how WLFI’s freeze and governance claims are treated.