Peter McCormack begins to duck Craig Wright in libel case

There has finally been some movement in Dr. Craig Wright’s ongoing defamation case against Peter McCormack in the United Kingdom. The discovery deadline in the case has been pushed back, and McCormack is looking to further delay discovery until he’s had a chance to file and argue for a motion to strike out Wright’s lawsuit before it reaches trial, depriving both Wright and the many interested spectators of the chance to see Wright face his detractors in court.

Wright originally filed his suit against McCormack in 2019, pointing to 10 tweets or series of tweets in which McCormack either directly or by innuendo called Wright a fraud for his claims that he is Bitcoin inventor Satoshi Nakamoto.

McCormack’s legal team filed their initial defense to the action on 9 August 2019 calling Wright’s suit a “cynical abuse of the court process” and making the point that it would be only too easy for Wright to prove he is Satoshi: in his file defense, McCormack said that a person wanting to prove their identity as Satoshi would only need to transfer the Bitcoin mined in the first eight blocks using the necessary private key, or alternatively sign a message with the relevant Satoshi private keys, and that doing either of these things would be “strong and compelling evidence that that person was Satoshi Nakamoto.”

With Wright maintaining that he does not have access to the so-called Satoshi keys, the ‘proof’ sought by McCormack in this case was always a red herring. It’s clear from everything Wright has said on the topic recently—including in the filings to come out of the Kleiman litigation—that Wright has never had any intention of using the so-called Satoshi keys to vindicate himself in the McCormack case. In any case, under the U.K.’s libel law, it’s down to McCormack to prove his statements were true—in other words, to prove that Wright is not Satoshi.

Even so, that McCormack would rely so heavily on the idea that Wright can ‘easily’ prove that he is Satoshi by using the private keys is interesting in light of the case’s most recent development. According to a court order from this week, McCormack has applied for an extension to the disclosure deadline and has indicated to the court that he intends to ‘imminently’ lodge an application to strike out Wright’s claim.

For a defendant taking the position that McCormack is, discovery should be his best friend: Wright should be able to provide no evidence in discovery supporting his claim to the Satoshi identity. In fact, if McCormack is correct that Wright is a fraud, then McCormack would have virtually nothing to lose in discovery, while Wright would have everything to lose.

Why, then, after belaboring the point that it should be easy for Wright to prove he is Satoshi and indicating that the absence of such proof is the evidence of its absence, is McCormack so keen to avoid discovery?

We can only speculate until the particulars of the strike-out motion are made public, but some glaringly obvious reasons come to mind based on what we already know about the case. Chiefly, that McCormack—since his initial defense which was bullish on the prospect of outing Wright as a fraud—may now be aware of something he knows would be revealed in discovery which would indicate Wright is indeed Satoshi, or at the very least undermine their defense. Just what might be worrying McCormack is hard to say, but Wright has long maintained that his status as Satoshi is independent of whatever he may or may not do with the so-called Satoshi private keys.

Based on that, it seems reasonable to assume there is more evidence waiting to be pulled from the ether that would just as credibly prove that Wright is Satoshi and undermine McCormack’s defense.

If it isn’t McCormack pulling the breaks, it might be whoever is helping him fund the litigation. McCormack has been vocal about the financial cost associated with being forced to defend his public statements yet has always seemed motivated to see the litigation through to the end, ostensibly so that he can be the one vindicated in his crusade to paint Wright as a fraud. That he is being funded from elsewhere would explain this apparent inconsistency between his concerns about bankrupting himself and his unrelenting commitment to ensuring litigation ends up as costly as possible.

As Wright has demonstrated his willingness to take the case as far as it can go, perhaps McCormack’s funders are having their own doubts about their ability to prove that Wright is fraudulently masquerading as the inventor of Bitcoin.

Or perhaps the answer is even simpler than that: perhaps McCormack, at the time he was blasting Wright on Twitter for being a fraud, had no idea whether Wright was telling the truth about being Satoshi, but nevertheless decided to hitch his wagon to the loud ‘Wright is a fraud’ movement. Perhaps he mistook Wright’s initial demand for a retraction and an apology and subsequent libel suit was a bluff on Wright’s part, part of an intimidation tactic aimed at ensuring Wright never has to face his accusers in court. Now that Wright has demonstrated he is ready to see his case through to the end, McCormack is left with a libel suit he has no grounds on which to defend.

The trial is currently scheduled for 4 May 2021. The application to delay discovery will be heard on July 30, at which point we should have a better idea of what we can look forward to between now and May of next year.

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