Wall Street Journal moves to dismiss Binance defamation case

The Wall Street Journal has asked a federal judge to dismiss Binance's defamation lawsuit over three reports that accused the crypto exchange of weakening internal compliance efforts and allowing more than $1 billion in transactions linked to sanctioned Iranian entities.
Summary

• The Wall Street Journal has asked a federal judge to dismiss Binance's defamation lawsuit over three reports about its compliance operations.
• Binance claims the reports falsely implied that investigators were fired for examining transactions linked to sanctioned Iranian entities.
• The Journal argues Binance has failed to show actual malice and says similar reporting by other major news outlets supports its case.
• Judge Paul Engelmayer questioned Binance over 22 allegedly defamatory statements and took the dismissal motion under submission.

According to Courthouse News Service reporter Josh Russell, attorneys for the Journal argued Wednesday that Binance's March 2026 complaint failed to show the newspaper knowingly published false information or acted with reckless disregard for the truth, the standard needed to establish actual malice.

The dispute stems from reporting about an internal Binance investigation into transactions that allegedly moved through the exchange to entities connected to Iran-backed groups.

Binance has denied key parts of the reporting and claims the Journal created a false impression that it fired investigators because of their work and stopped the internal probe.

U.S. District Judge Paul Engelmayer did not rule from the bench after hearing arguments and took the Journal's motion to dismiss under submission.

Wall Street Journal says Binance failed to show actual malice

At the center of the Journal's dismissal request is Binance's claim that the newspaper knew its reporting was wrong because the exchange disputed the allegations before and after publication.

The Journal argued in its filing that receiving denials from the subject of an investigation does not establish that reporters knew their work was false.

"The crux of Binance's complaint in this action is simple: the Journal knew its reporting was false because Binance sent the Journal self-serving denials prior to the article's publication and again after the article was published," the newspaper said in its motion.

According to the filing, Binance repeatedly relies on the same argument to support its allegations of actual malice. The Journal said repeating the allegation did not turn it into a viable defamation claim.

During Wednesday's hearing, Journal attorney Katherine Bolger of Davis Wright Tremaine argued that Binance had not denied the core facts underlying the three articles.

Bolger told the court that the lawsuit arose from Binance's objection to how the Journal presented information that the newspaper maintains was accurate.

"This defamation action springs not from false facts, but from Binance's unhappiness with the way the Journal reported truthful facts," Bolger said. "Binance's unhappiness with the Journal's editorial judgments does not constitute a defamation claim, and the claim should be dismissed."

Binance has taken the opposite position, arguing that the reports contained false statements and created defamatory implications about the exchange's compliance operations.

Binance says reporting falsely linked firings to Iran probe

Binance attorney Christopher Norman Lavigne of Withers Bergman told the court that the Journal created a misleading account of what happened to the exchange's internal investigation.

The dispute includes the Journal's February report headlined, "Binance Fired Staff Who Flagged $1 Billion Moving to Sanctioned Iran Entities."

Binance's complaint, filed March 11, said the investigators mentioned in the report were not dismissed because they raised compliance concerns and that its investigation continued after they left. The exchange also said accounts linked to suspicious activity were later removed from the platform.

Lavigne argued Wednesday that the internal probe was not dismantled as the Journal reported and said the headline created a false picture of Binance obstructing law enforcement and operating a deficient compliance program.

"Here you have an article that starts with a conclusion, ends with the conclusion, and peppered all throughout are the conclusion," Lavigne said.

Binance has also argued that the Journal's reporting can support a defamation-by-implication claim because readers could conclude that investigators were fired for examining transfers linked to Iran.
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The disagreement over the Iran-related transactions had already moved into the public record before the lawsuit. In March, Binance issued a formal response to a U.S. Senate inquiry and rejected allegations that it allowed transactions involving sanctioned Iranian entities, while defending its internal investigations and compliance controls. The exchange said reports cited by lawmakers contained unsupported claims about its conduct, as previously covered here by crypto.news.

Two months later, CEO Richard Teng again rejected the allegations, saying the Journal had made inaccurate claims about Binance's sanctions controls. Teng said Binance did not permit sanctioned individuals to use the platform and maintained that some transactions cited in the reporting occurred before the people involved were sanctioned.

Judge questions 22 statements cited by Binance

Engelmayer focused part of Wednesday's hearing on the individual statements Binance identified as defamatory.

The amended complaint lists 22 statements across three Journal articles that Binance considers actionable, according to Courthouse News Service. The judge pressed Lavigne to explain how specific statements were factually wrong and why they met the legal requirements for defamation.

Engelmayer also questioned why Binance sued the Journal when The New York Times and Fortune published separate reports about investigators who said they had uncovered possible Iran sanctions violations at the exchange.

Lavigne responded that the Journal's coverage went further than reporting by the other outlets and argued that the newspaper showed bias against Binance.

The Journal cited the existence of reporting by the Times and Fortune as evidence against Binance's actual-malice argument. Its attorneys said similar reporting from established news organizations gave the Journal additional reason to believe its own reporting was accurate.

"Given this prior reporting from reputable news outlets, the Journal would have no reason to believe that its own article on this subject was false," the newspaper said in a filing.

The original reports also triggered scrutiny in Washington. A Senate inquiry opened in February sought information about allegations that Binance facilitated transactions involving Iran-linked networks and questioned the dismissal of compliance staff who had investigated them.

By March, the U.S. Department of Justice was examining Iran-linked transactions that allegedly moved more than $1 billion through Binance, according to a Wall Street Journal report at the time. Investigators were looking at whether Iranian networks had used the exchange to bypass U.S. sanctions. Binance maintained that it had not directly transacted with sanctioned entities and said suspicious accounts identified through internal investigations were closed.

Binance lawsuit follows years of US compliance scrutiny

The current defamation fight comes after Binance's 2023 criminal settlement with U.S. authorities, when the exchange admitted violations involving anti-money laundering controls and sanctions.

Binance agreed to pay about $4.3 billion to resolve the case and accepted compliance oversight. Changpeng "CZ" Zhao stepped down as chief executive after pleading guilty to failing to maintain an effective anti-money laundering program and later served four months in prison.

President Donald Trump granted Zhao a full pardon in October 2025.

Zhao later said he was surprised by the decision and denied having a business relationship with Trump's family or World Liberty Financial. He also said he had never discussed a deal connecting Binance or the Trump-linked crypto venture to his clemency, according to coverage from November.

White House press secretary Karoline Leavitt said at the time that the Biden administration had pursued Zhao as part of what the Trump administration characterized as an effort to punish the cryptocurrency industry.

Questions about Binance and World Liberty Financial had surfaced months before the pardon. In March 2025, reports said members of the Trump family had discussed taking a stake in Binance.US while Zhao was seeking clemency, though Zhao denied having discussions about such an arrangement.

World Liberty Financial later became connected to Binance through USD1, its dollar-pegged stablecoin. The token was used for MGX's $2 billion investment in Binance, while reports about the transaction and the companies' relationships later drew political scrutiny.

Zhao's attorney subsequently rejected allegations that the pardon resulted from a pay-to-play arrangement, saying the former Binance chief had been prosecuted over compliance failures and disputing claims that his clemency was tied to Trump-related crypto ventures.

Engelmayer has taken the Journal's dismissal request under submission, leaving the 22 disputed statements and Binance's defamation-by-implication allegations before the court without an immediate ruling.
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