Tether Sued Over Alleged $42.4M Freeze Without Legal Basis
Two Thai businessmen have filed a lawsuit against Tether in the Southern District of New York over a $42.4 million freeze of their USDT holdings.
The plaintiffs, Nutthawat Rukthammachalern and Natthawat Kasamvilas, claim that Tether blacklisted 10 Ethereum addresses on October 30, 2025, almost four months before a seizure warrant existed.
Tether allegedly froze the tokens after an informal request from an HSI agent, without providing any legal basis. The plaintiffs emailed the company two days later and were directed to a special agent, but no further explanation was given.
A magistrate judge in the Eastern District of North Carolina issued a seizure warrant on February 19, 2026, directing Tether to burn the frozen tokens and reissue them to a government wallet. The plaintiffs are seeking relief from the freeze, including restored transferability, disgorgement of interest earned by Tether, and punitive damages.
The lawsuit also targets Circle, which refused to reissue frozen USDC without clear legal authority, contrasting with Tether's actions in this case.