Image Credit: Shutterstock
Two Thai businessmen have sued Tether over its freeze of 42.4 million USDT, alleging the stablecoin issuer blacklisted their Ethereum addresses months before US authorities obtained a seizure warrant.
Nutthawat Rukthammachalern and Natthawat Kasamvilas filed the case on August 31 in federal court in New York. They argue Tether acted without a warrant, court order or other legal process when it blocked their tokens on October 30, 2025.
Ten Ethereum Addresses Holding $42.4M Were Blacklisted
The complaint says Tether froze exactly 42,417,785.62 USDT across 10 Ethereum addresses after an informal request from a Homeland Security Investigations agent.
The plaintiffs say they acquired the USDT through secondary-market business transactions and had no contractual relationship with Tether. They argue Tether’s technical ability to blacklist tokens did not give it legal authority to restrict their property.
One plaintiff contacted Tether after discovering the restriction in November. The company allegedly directed him to an HSI agent rather than explaining the legal basis for the freeze.
Federal Seizure Warrant Arrived More Than Three Months Later
Federal authorities obtained a seizure warrant on February 19 targeting the disputed USDT and other funds linked to an alleged crypto investment fraud operation.
The warrant described a process under which Tether could burn frozen tokens, issue replacement USDT and transfer them to a government-controlled wallet.
Federal prosecutors separately announced five days later that they had seized more than $61 million in USDT from wallets they said were linked to investment scams.
The plaintiffs argue the February warrant cannot retroactively authorize Tether’s October freeze. They also dispute whether it permits Tether to destroy their tokens before ownership and forfeiture are finally determined.
Plaintiffs Seek Injunction Blocking Tether From Burning USDT
The lawsuit includes claims for conversion, trespass to chattels and unjust enrichment. The businessmen want the court to declare Tether’s actions unlawful, remove the blacklist and prevent the company from burning their USDT.
They are also seeking damages and income allegedly earned from reserves backing the frozen tokens. The complaint says the 42.4 million USDT remained frozen when the lawsuit was filed. The plaintiffs separately sought return of the funds in North Carolina on July 31.
Tether had not filed a public response as of September 2. The New York case asks whether the company had legal authority to freeze the plaintiffs’ USDT before federal authorities obtained the seizure warrant.
