Protocols & Policy · Litigation
The suit, brought on Circle's behalf, alleges the deals broke the Constitution's ban on taking payments from foreign governments; Circle says it did not start the case, and World Liberty calls the claims without merit.
A Circle shareholder sued President Trump and World Liberty Financial in federal court in Washington on Oct. 22, alleging that "more than $2 billion in payments from a foreign government" through crypto deals linked to the United Arab Emirates violated the Constitution [1, p. 1]. The suit invokes the foreign emoluments clause, which bars federal officials from accepting payments from foreign governments without Congress's consent [1, ¶94].
It is a derivative suit: a shareholder sues on the company's behalf, claiming the board will not, and any recovery goes to the company. Circle Internet Group is named only as a "nominal defendant," a party included so any recovery can flow to it, not one accused of wrongdoing; the complaint says no claims are asserted against it [1, p. 7; ¶136]. The case, Greenberg v. Trump, No. 1:26-cv-03686 in the U.S. District Court for the District of Columbia, lists nine parties, including World Liberty affiliates and special envoy Steven Witkoff [4]. Circle said it "did not initiate, direct, authorize, or participate in the filing," it told CNBC [2].
The complaint alleges two transactions. Before the inauguration, it says, the president agreed to sell part of his family's crypto company for $500 million "routed from the United Arab Emirates" [1, p. 2]. After he took office, it alleges, an investment fund created by the government of Abu Dhabi bought $2 billion of World Liberty's USD1 stablecoin [1, p. 2; ¶4]. USD1 is a dollar-backed token that the complaint calls a direct competitor of Circle's USDC [1, ¶119].
The shareholder argues Circle was hurt as a competitor, putting its lost reserve income at about $70 million to $82 million a year [1, ¶248; ¶260]. He claims asking Circle's board to sue would have been futile [1, ¶13; ¶186]. He seeks a declaration, an injunction, an accounting and disgorgement of the alleged emoluments, and damages [1, ¶14; pp. 67-68].
World Liberty spokesperson David Wachsman told CNBC: "These claims are without merit and we look forward to resolving them in court" [2]. None of the allegations has been tested in court. Politico reported the suit earlier Thursday [3].
The docket shows only the complaint, with a jury demand, and no judge assigned yet [4]. The next marker is the defendants' first filing in response.
Holding the Corner.
Not financial advice.