Tether Sued in SDNY Over USDT Freeze Without Prior Warrant
Two Thai brothers challenge Tether's blacklist of 42.4 million USDT in SDNY, testing authority to act on informal government requests before judicial process.
Two Thai brothers filed a lawsuit in the U.S. District Court for the Southern District of New York against Tether, alleging the company blacklisted ten Ethereum addresses holding exactly 42,417,785.62 USDT on October 30, 2025.
The complaint states that no warrant, court order, subpoena, or prior notice preceded the freeze. A North Carolina federal court issued a seizure warrant on February 19, 2026, directing Tether to burn the tokens and reissue an equal amount to a government-controlled wallet.
What Remains Unresolved
The plaintiffs seek an order blocking any burn of the USDT, requiring Tether to unblacklist the wallets, and awarding damages equal to claimed reserve income if the tokens are destroyed. Allegations remain unproven and the case is at an early stage with no ruling on Tether's authority or the legality of the freeze.