Craig Wright headphone Satoshi Nakamoto
Bitcoin,  People

Craig Wright begins playing offense in $7.2 billion bitcoin case

Craig Wright wants to know how Ira Kleiman paid $400,000 cash for a home shortly after he got his late bitcoin billionaire brother’s hard drives

Shortly after Craig Wright told Ira Kleiman that his deceased brother’s hard drives might hold a small fortune in bitcoin, Kleiman bought a house for $400,000 in cash.

Now the nChain founder and self-proclaimed Bitcoin creator Satoshi Nakamoto wants to know where the brother of his late partner and friend Dave Kleiman got the cash.

That’s because Ira Kleiman is suing Wright for half of a cache of one million bitcoins mined by Satoshi Nakamoto in the early days of the Bitcoin project. Worth $10 billion when the suit was filed, that’s currently about $7.1 billion. Ira Kleiman accused Wright of stealing them after his brother Dave’s death.

Wright began playing offense in a joint discovery memorandum filed on Dec.17 by both Ira Kleiman and Wright to keep their case moving forward. Both sides had a chance to weigh in on the request, and Kleiman isn’t talking.

So the implication of Wright’s request is pretty clear. After being called a thief and a liar in court, it’s payback time.

Show ME the money

Wright began playing offense by demanding “any real estate transactions by Ira Kleiman from April 1, 2013, to the present,” arguing that it was relevant. “By all reports, Ira was never a wealthy person, but in February of 2014, just weeks after Dr. Wright told Ira to preserve Dave’s electronic devices because they might contain bitcoin wallets, Ira purchased a home with $400,000 in cash.” 

His attorneys added, “Dr. Wright is entitled to discover whether Ira sold Dave’s bitcoin to finance his home purchase,” the paper states. 

Ira Kleiman’s attorneys disagree. “Defendant’s request is based on pure speculation, hence their citation to ‘[b]y all reports,’” they said. “How Ira purchased his home is not ‘relevant to any party’s claim or defense.’ There has been no evidence to suggest that Ira somehow obtained Bitcoin from his deceased brother, and sold it to buy a home. Simply stated, the [request for production] does not seek discoverable information, and is an unnecessary invasion of Ira’s privacy.”

That last sentence was written by the same people who tried to subpoena all of my personal hard drives going back to 2006, because I’ve interviewed Wright over the past few years. So, y’know, good luck out there everybody.

It is worth noting that it took less than 30 minutes online to find Ira Kleiman’s address and the exact date (Feb. 23, 2014) he purchased the five-bedroom, four-bath house. According to Zillow, the exact price paid was $449,500, not $400,000, the house is 3,215 square feet, and it sits on a 9,182-square-foot lot. 

Dave Kleiman’s Riviera Beach, FL, home sold for $199,029 on March 24, 2017, according to Zillow. That was four years after his death. He originally bought it for $111,900 in 1996. We do not know if the home had been used by the family or as a rental property between the time he died and when it sold.

I want it all

Wright doubled down on this demand for information the next day. On Dec. 18, he asked for, “All documents relating to any real estate transactions on behalf of the estate of David Kleiman from April 1, 2013, to the present.” As well as, “[a]ll documents relating to any real estate transactions by Ira Kleiman from April 1, 2013, to the present.”

Dave Kleiman was found dead in his home on April 27, 2013

Ira responded right away. Concerning Dave’s real estate transactions, his lawyers said, “[p]laintiffs object to this request because it seeks information that has no relevance to any issue related to the claims and defenses of this case. This kind of discovery is expressly forbidden by the federal rules, which limit the scope of discovery to ‘nonprivileged matter[s] that [are] relevant to any party’s claim or defense.’” 

They added, “[a]ny potential real estate transactions taken on behalf of the estate have nothing to do with the claims and defenses at issue in this litigation.”

Regarding Ira’s real estate dealings, his attorneys cite the same rules in their objection. “Real estate transactions undertaken by Ira have nothing to do with the claims and defenses at issue in this litigation.”

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Brendan Sullivan is a writer, producer, and author of the memoir Rivington Was Ours: Lady Gaga, the Lower East Side, and the Prime of Our Lives. Disclosure: he owns cryptocurrencies. Follow him on Twitter.