Binance Co-Founder CZ Moves to Dismiss $1.8B FTX Lawsuit (Report)

Changpeng Zhao (CZ) has filed a movement to dismiss a $1.76 billion lawsuit introduced in opposition to him by the FTX chapter belief.

He says the courtroom has no authorized authority over him as a result of he lives within the United Arab Emirates (UAE).

CZ’s Defence

In keeping with a Bloomberg report, his authorized workforce submitted the movement on Monday to the U.S. Chapter Courtroom for the District of Delaware, asserting that the accusations fall exterior the courtroom’s attain.

“The claims are to date faraway from Delaware and even america that the statutes at concern, which lack extraterritorial utility, don’t even apply,” his legal professionals wrote within the submitting.

Lodged in November 2024, the lawsuit accuses Zhao, Binance, and several other former executives of receiving billions of {dollars} in funds that had been wrongfully moved by FTX founder Sam Bankman-Fried (SBF). It focuses on a July 2021 deal the place the change sold again its fairness in FTX’s worldwide and US-based entities. In keeping with the belief, Binance held a 20% stake in FTX’s worldwide unit and 18.4% within the U.S. arm.

Courtroom information present that Alameda Ltd, an organization registered within the British Virgin Islands, transferred the funds for FTX. However, the Binance entities concerned had been registered in Eire, the Cayman Islands, and the British Virgin Islands. CZ’s authorized workforce argues this makes the transaction international and outdoors the attain of U.S. chapter legal guidelines. Additionally they declare he was a “nominal counterparty” within the deal, that means he was not deeply concerned within the course of.

Zhao’s submission additionally described the connection between FTX and Binance as solely non permanent. They ended their partnership attributable to private disagreements, after which Binance’s fairness in Bankman-Fried’s enterprise was exchanged for cryptocurrency.

The crypto entrepreneur claims the lawsuit unfairly blames him and Binance for the collapse of FTX, which he described took place on account of SBF’s misconduct. He additionally argued that serving authorized papers by means of U.S.-based legal professionals just isn’t legitimate underneath chapter regulation when the defendant lives overseas. His workforce says the belief is making an attempt to stretch its claims past U.S. borders in methods that aren’t supported by the regulation. They are saying the fraud claims don’t meet the requirements required for defense underneath federal guidelines tied to securities contracts.

Former Binance Executives Additionally Looking for Dismissal

This growth follows related motions filed final month by former Binance executives Samuel Wenjun Lim and Dinghua Xiao, who’re additionally named within the FTX go well with and are looking for to be faraway from the case.

CZ accomplished a four-month jail sentence in September final 12 months after pleading responsible to U.S. anti-money-laundering violations. In the meantime, Sam Bankman-Fried is serving 25 years for fraud and conspiracy.

Elsewhere, the defunct change announced it’ll begin distributing the subsequent batch of creditor claims on September 30. As of August 2025, it has returned roughly $6.2 billion to former prospects throughout two main rounds.