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Home»Legal»NY Court Pauses Default Judgment After Lawyer Argues 39,069 Bitcoin Wallets Were Not Abandoned
Legal

NY Court Pauses Default Judgment After Lawyer Argues 39,069 Bitcoin Wallets Were Not Abandoned

NBTCBy NBTC14/06/2026No Comments6 Mins Read
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A New York attorney intervened to stop what could have been the largest courtroom judgment in bitcoin in history, filing an amicus brief that persuaded a judge to freeze proceedings targeting nearly 40,000 dormant wallets collectively holding an estimated 3.8 million $BTC.

  • Key Takeaways:

  • On June 6, 47.26 $BTC dormant since 2011 moved onchain from defendant address No. 37923 in the Noah Doe case.
  • NY attorney Ian R. Cohen filed an amicus brief on May 29, prompting a June 5 court stay in Index No. 153119/2026.
  • The case targets 39,069 wallets worth ~$293B; a hearing will now decide if the lost-property theory holds up.

2011-Era Coins Are Moving

The legal battle is unfolding alongside a wave of onchain activity from some of bitcoin’s oldest addresses. On June 6, 2026, Galaxy Research flagged a transaction involving 47.26 $BTC, worth approximately $2.88 million, moving out of a wallet that had been untouched since June 17, 2011, a dormancy period of more than 15 years.

The address, 18sLgPeB9wQVrE8JoWqtKtnucbsx3Lw1m7, is listed as defendant address No. 37923 in a New York Supreme Court case styled ABC Company, XYZ Company, and Noah Doe v. John Does 1-39,069, Index No. 153119/2026. Alex Thorn, head of firmwide research at Galaxy, noted the movement on X, calling attention to the growing pattern of named addresses showing activity after years of silence.

“More 2011 coins that were claimed as ‘lost’ in the ‘noah doe’ NY state lost-and-found case are awakening and moving onchain,” Thorn wrote.

That June 6 transaction was not isolated. Another transfer tied to the case, 25 $BTC from a Casascius coin redemption, was spent at block height 952534 and discovered by Galaxy Research. On June 2, a separate wallet dormant since March 2011 moved 35.55 $BTC, becoming one of the first defendant addresses in the Noah Doe suit to register any onchain action after being named in court filings.

Each of these movements chips away at the central premise of the lawsuit: that these wallets were abandoned.

The Noah Doe Lawsuit

Filed March 11, 2026, and amended May 1, the case rests on a novel legal theory. A pseudonymous plaintiff identified in court documents as Noah Doe, a New York resident, claims he developed an algorithm that identified dormant bitcoin wallets exhibiting what he describes as a security vulnerability. He placed lists of wallet public addresses on USB drives and delivered them to the NYPD’s 17th Precinct in batches between December 2024 and April 2025.

He then directed a cyber expert to insert OP_RETURN messages into each wallet directing holders to a webpage, where they had 90 days to demonstrate their wallets were not abandoned. Of 42,001 wallets initially identified, 424 took onchain action and were removed. The remaining 39,069, valued at roughly $293 billion at current market prices, became the basis for a declaratory judgment claim that Noah Doe and two Wyoming LLCs own them outright under New York’s lost-and-found property statute.

The Amicus Intervention

On May 29, 2026, New York attorney Ian R. Cohen filed a Proposed Order to Show Cause along with a proposed amicus curiae brief, NYSCEF Doc. No. 33, before Hon. Kathy J. King in New York County Supreme Court. Cohen’s brief, submitted on behalf of no party but as an independent voice for adversarial analysis, mounts a systematic legal challenge across seven points.

His core argument: Article 7-B of the New York Personal Property Law, the lost-and-found statute the plaintiffs rely on, was written for tangible physical objects, not entries on a globally distributed blockchain. A person scanning a public ledger with an algorithm is not a “finder” under the statute. Bitcoin cannot be physically deposited with police. And dormancy, Cohen argues, is not abandonment.

“Abandonment requires intentional relinquishment of ownership and an external act manifesting that intent,” Cohen wrote. Cohen’s amicus further states:

“Mere inactivity, no matter how prolonged, is not abandonment.”

Cohen also flagged the proper legal framework. New York’s Abandoned Property Law, amended in 2022 to specifically address unclaimed virtual currency, routes dormant crypto assets to the State Comptroller for escheat, not to private parties or Wyoming LLCs.

He further challenged the suit’s due process foundation, arguing OP_RETURN messages and a global press release do not constitute constitutionally adequate notice, particularly for deceased holders, non-English speakers, and wallets using older address formats that may not receive such messages.

He also raised jurisdictional questions, noting that bitcoin has no cognizable legal situs in New York and that the vast majority of the 39,069 wallet holders are almost certainly not New York residents. Cohen’s brief also pointed to a judicial recusal that had already occurred in the case.

Acting Justice Emily Morales-Minerva recused herself on March 23, 2026, citing an ethical conflict with being directed to rule on a matter another justice in the same jurisdiction had already partially decided.

Court Acts on June 5

The court moved quickly. On June 5, 2026, Judge King issued a Decision and Order on Motion No. 001, characterized as an injunction and restraining order, and took action on Motion No. 004, Cohen’s amicus-related filing. The proceedings were stayed and any push toward a default judgment was halted pending further hearing.

Image source: Cohen’s X post about the court case.

The stay is significant because the defendant wallet addresses, served via OP_RETURN and press release, are unlikely to appear and contest the case. Without adversarial input, the plaintiffs’ theory risked proceeding unchecked toward an uncontested default. Cohen’s intervention changed that calculus.

“Not your keys, not your coins,” Cohen wrote in his brief, invoking the foundational bitcoin principle and applying it directly to the court’s consideration of the claim.

What This All Means

The case carries implications beyond the courtroom. If the Noah Doe theory prevailed, any party with blockchain analysis tools and a police station nearby could theoretically target long-dormant wallets anywhere on the bitcoin network. Cohen’s brief explicitly named that risk, warning the court that accepting the plaintiffs’ argument would threaten the property rights of every self-custody bitcoin holder in New York.

The wallet list in the case includes addresses linked in public reporting to the 2011 Mt. Gox hack, and others analyzed as potentially associated with Bitcoin’s genesis-era mining. The “1Feex” address, listed as John Doe No. 1, holds approximately 80,000 $BTC and has been widely discussed in connection with the Mt Gox theft.

Cohen noted that a New York state-court ownership declaration over assets potentially subject to Japanese civil rehabilitation proceedings and U.S. federal forfeiture interest would risk serious legal conflict. The court’s stay means the case now heads toward a hearing with those questions on the table.

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NBTC is the editorial account for NBTC News, covering Bitcoin, Ethereum, DeFi, blockchain infrastructure, exchanges, mining, regulation and digital asset markets. The editorial team focuses on clear sourcing, timely updates and practical context for crypto readers.

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