The first week of the biggest Bitcoin lawsuit in history is coming to a close. In it, Ira Kleiman, the estranged brother of the late David Kleiman, is suing Dr. Craig Wright for a share of 1.1 million bitcoins and valuable intellectual property.
There have been no bombshells yet, but the Kleiman v Wright case is slowly taking shape. Today, a lawyer from Tragos, Sartes, & Tragos, took to YouTube to summarize how things are shaking out so far.
Who is Peter Tragos?
Peter Tragos is a lawyer based out of Clearwater, Florida. He’s described himself as a digital currency novice who made this video to give his legal thoughts and opinions on the trial so far.
Tragos emphasizes that as a lawyer, the burden of proof is on the plaintiff, and so far, he doesn’t feel they are winning. As a neutral party with no bias to any particular blockchain or digital currency and as a professional lawyer assessing the facts, Tragos’ opinion should hold weight with anyone who wants an unbiased, unfiltered view of what’s going on.
Kleiman v. Wright week one: key points so far
“More than one witness has testified that they think a certain person involved in this trial is Satoshi,” Tragos said.
One of the important points covered in Tragos’ video is that several witnesses have testified that they believe Dr. Craig Wright is Satoshi Nakamoto.
If you’re a regular CoinGeek reader, you’ll know that evidence that Dr. Wright is the inventor has been slowly dripping out over the past several years, and he’s adamant that while it’s not the key question in this case, it will be proven nonetheless.
Tragos tells us that after eliminating several potential jurors for conflicts of interest, 10 people were selected and sworn in. Seven women and three men were picked with an average age in their 50s. While nine of them do own some digital assets, they are understood to have little to no understanding of Bitcoin or digital currencies in general.
Tragos said he includes himself in that group of people with little understanding of digital currencies. “Most of these potential jurors had no clue…anything about even the most basic things with Bitcoin. I would probably be included in that group,” he said in the first minutes of the video.
The plaintiffs’ lawyer opened first, giving a fiery statement in which he accused Dr. Wright of stealing bitcoins from his deceased friend David Kleiman. It was thick on theatrics and hyperbole and certainly gripped the attention of all in the courthouse.
Next up were lawyers for the defense. In a much more down-to-earth and matter-of-fact tone, they outlined how Dr. Wright is not a fraud or a dishonest man but is, in fact, the inventor of Bitcoin. They outlined how David Kleiman was one of Dr. Wright’s closest friends but emphasized that he was not his partner in any matters related to Bitcoin.
First witness: Andreas Antonopoulos
Andreas Antonopoulos is the author of a best-selling book called Mastering Bitcoin. He was called forward as an expert who could give the jury a boiler-plate breakdown on what Bitcoin is, how it works, and a few other details that might help them understand the proceedings.
Mr. Antonopoulos talked at length about his credentials and his consulting fees. He noted that he was the most-cited Bitcoin expert and that he could charge between $500 and $750 per hour for his services.
However, when cross-examined by the defense, the so-called expert was much less comfortable in his skin. During the cross, it was revealed that Mr. Antonopoulos has never successfully mined Bitcoin, has no formal training in economics, and has no idea who the 1.1 million bitcoins at stake belong to.
“I think they (the defense) did a good job of just brushing him aside…they did a good job of diffusing this witness,” Tragos said.
Second witness: Patrick Paige
Patrick Paige was a longtime friend of David Kleiman, and his testimony revealed several vital pieces of information.
One of the most interesting things that came to light during Paige’s deposition was an email from Dr. Wright in which he informed Paige that:
“Dave and I had a project in the U.S. He ran it there. We kept what we did secret. The company we ran there mined Bitcoin.”
Tragos thought that, overall, it was great for the plaintiff to make these points. The emails showed they were working together, with Dave based in the U.S. and that it did involve Bitcoin.
However, the cross-examination of Paige revealed that he had business dealings with David Kleiman and that this partnership was clearly laid out in a detailed and written structure. This point highlighted the fact that Kleiman had a history of formalizing business partnerships, even with one of his best friends, and is unlikely to have engaged in a partnership with Dr. Wright without such an agreement in place.
Tragos thought that this cross-examination scored some excellent points for the defense. “If you look at Dave’s life…he makes partnership agreements. He makes LLCs with people to do business. So if a partnership existed with Wright, Dave Kleiman would have put something in writing,” he said.
Third witness: Gavin Andresen
People involved in the Bitcoin ecosystem will be familiar with this name. Andresen was Satoshi Nakamoto’s right-hand man and is the developer Satoshi handed the project over to when he left to move on to other things.
Andresen has previously stated publicly that he believes Dr. Wright is Satoshi Nakamoto, although he considers Satoshi was ultimately a group of three people with Dr. Wright in charge. This sentiment is shared by Patrick Paige.
Andresen gave a videotaped deposition in which he covered how Dr. Wright was able to tell him things only Satoshi would have known and that he was able to sign several blocks of his choosing with Satoshi Nakamoto’s private keys. Andresen concedes that some of the things Dr. Wright showed him could have been fraudulent but previously said that he believes it’s “more likely than not” that the key signings were legitimate.
Tragos largely dismissed this notion that some of the things Dr. Wright showed Gavin might have been fraudulent as speculative. “I would have objected to speculation,” he said.
Fourth witness: Jamie Wilson
Jamie Wilson was an accountant, a director, and a CFO for some of Dr. Wright’s previous companies in Australia.
Wilson stated that Dr. Wright had previously told him he has over 1 million bitcoins, that his friend David Kleiman had helped him out, and that he believes Dr. Wright has the coins and will be able to pay the plaintiff if the jury ruled in his favor.
When cross-examined, Wilson came across as a disgruntled employee who may be biased against Dr. Wright, according to Tragos. The defense showed how he had even gone as far as congratulating Ira Kleiman when he filed suit against Dr. Wright, showing that he may have a personal grudge against him, and therefore, may not be a reliable and unbiased witness. This much was evident from other things Wilson said about Dr. Wright on the stand, showing clearly that he personally is not a fan of the defendant.
Wilson also conceded that he has no details on whether Dr. Wright bought, mined, or otherwise obtained the bitcoins he claims to have.
“We knew it was going to be hard for the plaintiff. Dave is no longer with us. Dave Kleiman can’t take the stand and explain what happened, so it’s all conjecture, speculation, hearsay…I saw this or saw that to make it seem like something that it doesn’t actually prove it is,” Tragos informs us. “Just because he saw that Craig Wright has a million bitcoins…that doesn’t mean he mined them with Dave Kleiman and that they had a partnership and half of those belong to Dave Kleiman’s estate.”
Fifth witness: Jimmy Nguyen
Jimmy Nguyen is the founding president of Bitcoin Association and will be familiar to anyone who watches CoinGeek conferences. He gave a videotaped deposition in which he reiterated his belief that Dr. Wright is Satoshi Nakamoto, but he might have had help from others to make Bitcoin a reality.
Tragos emphasizes that this testimony that Dr. Wright is Satoshi “is evidence on the record.”
Unlike on social media and the internet, where opinions count for nothing, witnesses testifying under oath that Dr. Wright is Satoshi Nakamoto actually holds weight in the courtroom. Tragos rightly points out that Jimmy Nguyen is the third witness to state that Dr. Wright is Satoshi in the proceedings so far.
Sixth witness: Ira Kleiman
Ira Kleiman is the estranged brother of Dave Kleiman and is the personal representative of his estate. He’s the man behind this lawsuit and is technically the plaintiff.
During the direct examination of Ira Kleiman, an email was presented which showed that Dr. Wright used the words “we did partner” when talking about Dave Kleiman. However, no context is provided on what the partnership entailed, and as has been shown elsewhere, Dave Kleiman and Dr. Wright had partnered on other formally documented ventures. Likewise, even if it could be assumed that the partnership was in reference to Bitcoin, no details are provided on what the percentages should be, let alone any other details that would help determine what the plaintiff should be owed.
During the cross-examination of Ira Kleiman, Dr. Wright’s lawyers showed that no written agreement existed, which is uncharacteristic of Dave Kleiman given his insistence on using LLCs and binding agreements in his other dealings. They also pointed out that Dave Kleiman left a will that did not mention Bitcoin, did not mention a partnership with Dr. Wright, or anything of value that Ira Kleiman would have a right to.
However, Tragos does think the evidence here is potentially damning. Why would Dave Kleiman have to sign anything over to Dr. Wright if no partnership existed? “That’s good for the plaintiff, but I don’t know if it’s enough to actually prove it,” Tragos tells us in his insightful video. “It’s circumstantial. It’s second-hand, kind of.”
Further examination revealed that Dave Kleiman was financially destitute in his final years, was deep in debt, and that his tax returns don’t show anything that would hint at a Bitcoin mining operation. It’s reasonable to assume that if he had mined a massive trove of bitcoins that he may have attempted to sell some of them to relieve his financial burdens and pay medical bills.
Ira Kleiman admitted that his brother never mentioned a partnership with Dr. Wright or that he was in possession of a substantial amount of bitcoins. The only thing Ira Kleiman was able to recall was a vague recollection of his brother telling him that he was working “with a wealthy foreign guy to create his own money” and then drawing a Bitcoin logo at a Thanksgiving party.
Week one: it’s looking good for the defense
“If I’m sitting there and if I’m a juror, I’m leaning pretty heavily towards the defense,” Tragos tells us in the closing section of the video.
While it is still early days and the trail has a long way to go, things are looking good for Dr. Wright and the defense so far. The plaintiff has produced nothing substantive to show a partnership between his late brother and Dr. Wright, although there’s still time to produce it if it does exist.
CoinGeek will keep you posted on the biggest case in Bitcoin history as it unfolds. As of right now, it should be a wrap by Thanksgiving.
Check out all of the CoinGeek special reports on the Kleiman v Wright YouTube playlist.
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