Week one of the Satoshi Nakamoto trial of the century is in the books. The entire week was taken up by the plaintiff’s case-in-chief, and some of the case’s most vital characters took the stand. As such, it was a highly revealing week. Here are the most telling developments—and what they mean for the rest of Kleiman v Wright trial.
Dave Kleiman was in desperate need of money before his death
Dave Kleiman has been a looming presence at trial so far. After all, Ira Kleiman is only here in his capacity as representative of Dave’s estate, and the question at issue can be put simply as whether or not the invention of Bitcoin was the product of a partnership between Dr. Wright and Dave Kleiman or whether it was Dr. Wright alone.
The type of person Dave Kleiman was is important. After all, according to Ira, the man was a 50-50 Satoshi Nakamoto partner in one of the most groundbreaking inventions ever made, so the parties predictably would want to examine whether he’s the kind of person that was in a position for that to make sense. This is particularly so considering there is no evidence of the alleged partners ever discussing Bitcoin or the Bitcoin white paper.
Ira said as much under cross examination.
Q: You said there was no treasure in Dave’s estate, but now you think that Dave was Satoshi?
Q: You had a hard time believing at first that Dave was Satoshi?
Q: You never saw Dave do software activities?
Q: You never saw Dave program?
We have also known that Dave Kleiman was in dire financial straits at the time of his death. What wasn’t known was the extent of his hardship.
The jury heard how Dave had maxed out multiple credit cards before his death, was selling personal possessions for cash—including his air conditioner and wheelchair—and had taken out loans against his home. An email written by Ira Kleiman was shown which revealed that Dave’s bank was chasing his estate for $560,000. Ira also admitted that he gave his share of an unspecified inheritance to Dave.
On cross examination, Andrew Rivero also took Ira and the journey through Dave’s tax returns. In the period that Dave should have been mining Bitcoin, he reported no costs at all.
Despite being destitute and clearly in need of money, Dave never once did anything that would suggest he was trying to access or sell a fortune of Bitcoin he believed he was owed—a strange course of action for one half of the wealthiest business partnership ever created.
Dave Kleiman and Craig Wright never emailed one another about Bitcoin
We also saw a relatively vivid picture painted of the nature of the relationship between Dr. Wright and Dave Kleiman. It mostly came on the defense’s cross examination of Ira: Andres Rivero walked Ira and the jury through a timeline of emails between Dr. Wright and Dave.
They portrayed a highly communicative working relationship whenever the two would align on a project. This included detailed emails setting out who would do what tasks, regular check-ins from both parties to assess the progress being made and jubilation upon completion.
Rivero made this obvious for the jury when questioning Ira. After showing examples of Dave Kleiman and Dr. Wright congratulating and keeping one another up to date with their work (for example, one email showed Dave Kleiman congratulation Dr. Wright for completing a master’s degree), Rivero and Ira have the following exchange:
Q: So he’s congratulating Craig Wright on getting a master’s, right?
Q: But, sir, we don’t see any email where the congratulate each other for the Bitcoin white paper from Halloween until November 27th?
A: No. I haven’t seen it.
Q: And you don’t know of such a congratulatory email, like we saw on [the Data Wipe Fallacy paper both Dr. Wright and Dave worked on]?
In a case with so little direct evidence, the absence of evidence is often the best substitute. Rivero is painting the picture that for the two to not discuss their world-changing Bitcoin project is a significant departure from their normal working relationship.
The only email between Dave and Craig that could be argued to concern Bitcoin was one sent some months before the release of the Bitcoin white paper in which Craig asked Dave for help editing a paper. From then until after the release of the paper, there is no mention of any collaboration between them in any of their communications.
Rivero revealed that there are also no financial records—either of Dave’s personally or W&K’s—which show any business expenses from this period. Certainly, if either Dave or W&K were embarking on large scale mining operations, we would expect to see the purchase of computer equipment and similar outgoings. Here, there’s none of that.
Unfortunately, records of W&K are particularly limited, because since Ira reinstated the company in 2018 and installed himself as its authorized agent, not a single tax return has been filed relating to the company. Ira Kleiman is currently being sued by Lynne Wright to declare he never had the authorization to reinstate W&K.
Dr. Wright not the only one of Dave Kleiman’s best friends to be sued by Ira
After a brief appearance in court on the opening day of trial, Ira Kleiman was a no-show on day two, the first full day of substantive witness examination.
He returned on Wednesday to begin his deposition, and the jurors got the first real impression of the instigator of this lawsuit.
Perhaps the most telling detail shown to the jury was the fact that Dr. Wright is far from the only one of Dave Kleiman’s best friends to be sued by Ira over misappropriated Bitcoin.
On Thursday, Rivero asked Ira about other attempts of his to get a hold of Bitcoin via litigation. We know from Ira’s deposition that he had sued Patrick Paige and Carter Conrad, Dave’s two other best friends, to try and recover Bitcoin which he says was Dave’s. That suit was dropped, but Rivero’s questioning on cross-examination was still revealing.
Q: When was this suit dropped?
A: I don’t remember.
Q: Did it overlap with this suit?
A: I don’t remember.
Q: Do you make allegations lightly?
Q: You were maintaining multiple suits claiming multiple of Dave’s friends [had Bitcoin belonging to Dave]?
Q: You sued all of Dave’s best friends?
Just as revealing about Ira is his testimony about Thanksgiving in 2009. The jury heard how the last time Dave and Ira Kleiman met one another was at that dinner. It’s here that Dave supposedly told the only other living soul about his collaboration with Dr. Wright on the invention of Bitcoin, telling him he was working on creating digital money, a project bigger than Facebook, with a wealthy foreign man. And despite Dave’s health declining steeply from then until his death in 2013, Ira never visited Dave in hospital. Nor did he ask or attempt to find out about what became of Dave’s world-changing project of digital money, which Ira undoubtedly should have found at odds with Dave’s predicament and apparent poverty.
Ira Kleiman didn’t seem to mind.
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