Screenshot of Craig Wright speaking with Modern Consensus contributor Brendan J. Sullivan, September 11, 2019.
Bitcoin,  Opinion

Ira Kleiman’s lawyer sure sounds like he wants to settle the $10 billion Craig Wright/Satoshi case

Here’s why we may not get another round of discovery—or why we may never know who is Satoshi Nakamoto

On Thursday, a judge granted Ira Kleiman’s attorney a 21-day extension on the motion to quash the subpoena against Modern Consensus contributor Brendan Sullivan (that’s me). This, along with a yet-to-be published interview with Craig Wright and a document filed in court earlier this week, leads me to think that settlement talks are in the works. I’ll go through all three documents and why they matter.

1) The September 16 email

On Monday September 16—the day before they filed a joint motion for a 30-day extension—my attorney got an email from Velvel Freedman, Kleiman’s lawyer, asking for a three-week extension. “I’ve just started my own firm, had a trial, had a daughter,” Freedman wrote in an email. “Things are a bit busy.” 

My lawyer and I are tough, but we’re not cruel. We agreed to the extension to October 10, 2019 and it was granted by the courts on Thursday.

“Plaintiffs motion for an extension of time [3] to respond to Petitioners motion to quash [1] is GRANTED. Plaintiff shall respond to Petitioners motion to quash by October 10, 2019. Ordered by Judge LaShann DeArcy Hall on 9/19/2019.”

We agreed to this. It seemed like it could do no harm.

2) The September 17 joint motion

The next day, September 17, 2019, lawyers representing Craig Wright and the estate of Dave Kleiman filed a “Joint motion for 30 Day extension for all discovery.” It’s nice to seem them agree on something! In this filing they state, “The parties have been engaged in extensive settlement negotiations and have reached a non-binding agreement in principle to settle this matter.”

This would indicate not only that they are in talks, but that they are starting to get to an agreement. Pure speculation: It’s starting to sound like the $10 billion bitcoin at stake is not going to show up anytime soon. However, this could leave Craig Wright on the hook for something closer to the $5 million it was worth when Dave Kleiman passed away in 2013. BTC trades at about $10,100 today but it was worth $5 in 2013.

“The parties are continuing to negotiate, finalize all relevant terms, and document the agreement appropriately.”

You know that scene in the Big Lebowski when he figures out he’s been played? “You threw a ringer for a ringer!” That’s about where we are right now in this case.

Ever since I got subpoenaed, I’ve been asking, why? Wright is just a person I’ve spoken to a couple of times. We get along and we have similar taste in suits and wine, so he is a little less prickly with me than the dweebs at other tech magazines. 

Why does that matter? They want leverage.

The subpoena against me will never hold up in court. Journalists are shielded from frivolous moves like this in both Florida and New York. However, they have to go after me to use what Wright said in our last interview in court. But not in settlement talks. To use another big Lebowski quote: “You could use it as an excuse to make some money disappear. All you needed was a sap to pin it on, and you’d just met me.”

3) My latest interview with Craig Wright

While chatting with Wright last week he said rather cryptically, “Adam Smith and others were really lucky. Because they had this thing in their will, and he had a friend. It said that when he dies, all the notes are going to be thrown into the fire and destroyed with only the published final works surviving, none of the things with spelling errors or scribbled out things. You get to be remembered differently when you have your notes destroyed.”

I didn’t understand it at the time, but I wrote it down, recording my screen grab of our Skype discussion, and had a camera rolling. I thought he was just grousing about the lawyers making our lives crazy. But now I see that it’s a sign of Wright losing some ground.

If he and Dave Kleiman ever had another kind of arrangement, the draft paper trail is starting to catch up with him. In other words, if Kleiman’s estate can find a contract between Dave and Craig—even one that was never executed—it could be worth $10 billion.

Here’s an excerpt from my interview with Wright:

Brendan J. Sullivan (me): “What do they want?” 

Craig Wright: “Uh, money?” 

BJS: “What amount of money would actually satisfy any of them?” 

CW: “Uh, how much money is in the earth? You take the richest ten thousand people and you multiply their money by a thousand, and I think they might just be okay, each.”

Let’s say Wright did think that some arrangement might bring 1 million bitcoins into his possession again. Why would he keep fighting in Florida when he could just disappear with it? I asked him why he didn’t just never go back to Florida again. 

“I think Luke Junior comes from Florida? The Bitcoin Core developer? That’s all I have to say on that,” he replied.

Yesterday I reached out to Bitcoin Core developer Luke Dash, Jr. for a comment on the matter. “I see nothing to comment on. Con man drops names. Big deal,” he said via Twitter direct message, “Everyone knows I’m from Florida.”

The biggest mystery in crypto is, who is Satoshi Nakamoto? We may never know. But the person who would know best is the person who can move the original, untouched bitcoin known as the “Satoshi Blocks.” The assumption being that whoever mined the original blocks was there at the start. If a judge orders Wright to turn over the original bitcoin, we may learn more. If they settle out of court, we may never know.

There is no winning or losing anymore. If Wright can pay them to go away, he might have to—and it sounds more and more like it might be worth it, even if it’s not justice. The main question now seems to be, how much will it be?

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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.