Australian computer scientist and purported Bitcoin creator Craig Wright has already launched an appeal against a Florida Federal Court ruling that may see him forced to hand over half of his multi-billion dollar Bitcoin fortune and intellectual property.

A hearing in the year-long Kleiman v. Wright case, which concluded in US District Court for the Southern District of Florida, saw Magistrate Judge Bruce Reinhart deny Wright’s motion to dismiss the Kleiman lawsuit based on lack of jurisdiction, with the self-declared Bitcoin inventor ordered to deliver over 500,000 BTC (roughly $7.7 billion) to the Kleinman estate.

Wright’s Miami-based legal team was due to lodge the ruling challenge by 10 September but has requested a two-week extension citing delays caused by Hurricane Dorian’s imminent landfall in Central and South Florida.

It’s all about the money

Magistrate Judge Reinhart issued a recommendation to the District Court judge assigned to the lawsuit that, even if adopted, is not a final ruling — but could potentially see Wright lose half of the Bitcoin mined by the Australian computer scientist before December 31, 2013.

The ruling would also result in half of the intellectual property owned by Wright prior 2014 passed to the Kleiman estate.

The Kleiman v. Wright lawsuit was launched in 2018 when Ira Kleiman, the brother of Wright’s former business partner and purported early Bitcoin core developer Dave Kleiman alleged that Wright defrauded Kleiman of 1.1 million Bitcoin subsequent to his death in 2013.

The Kleiman estate is seeking a portion of the Bitcoin allegedly held by Wright — including the mysterious “Tulip Trust”, which is rumoured to contain Satoshi Nakamoto’s 1 million Bitcoin hoard.

Wright has moved to have the Kleiman lawsuit dismissed on multiple occasions since the filing, providing email evidence to the court in May 2019 that purportedly demonstrates a 2012 exchange between Kleiman and Wright associate Uyen Nguyen in which Kleiman cedes sole membership of the firm.

Testimony provided to the court by cyber security engineer and FBI consultant Dr. Matthew Edman, however, identified the email chain as fraudulent — placing the timestamp on the exchange as 2014, one year after the Kleiman’s death.

Wright ruled “not credible”

Wright’s move for dismissal was denied by U.S. District Judge Beth Bloom on August 15, with the court ruling that Wright’s testimony lacked credibility. Judge Bloom highlighted inconsistencies in Wright’s statements regarding the ownership structure of W&K Info Defense Research LLC — Wright claimed in an April 2018 affidavit that he had “never been a member of W&K,” later testifying under oath that he was not an owner of W&K in June 2019.

Should the Kleiman estate be awarded with the 500,000 Bitcoin it seeks, US estate law would require the estate to fulfil a 40% tax obligation. August 2019 prices would place the Kleiman estate’s tax obligation at over $USD 2 billion, potentially forcing the estate to sell over 200,000 Bitcoin — an amount that would significantly impact the Bitcoin market.

Judge Reinhart’s recommendation is yet to reach the District Court judge presiding over the Kleiman v. Wright case, which will not be decided until a final trial in March 2020.

Last week, a Pakistani man, James Bilal Khalid Caan, claimed to be the real Bitcoin creator, but was largely derided by the crypto community.