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The victims of North Korea are seeking to recover their court-awarded damages via funds seized by 
Arbitrum from last month's 
KelpDAO exploit.
What's the Scoop?
- Restraining Order: Lawyers representing the victims of North Korean terror have filed for a restraining against Arbitrum, targeting assets seized from the suspected DPRK hack of KelpDAO, a development that is bound to complicate efforts to return approximately $70M in frozen funds to victims of the exploit.
- Service Provided: The United States District Court for the Southern District of New York has granted the restraining order against Arbitrum, approving a service plan that involves posting the restraining order to Arbitrum's governance forum, mailing copies to legal entities behind Arbitrum DAO, mailing copies to members of the Arbitrum Security Council, and mailing copies to large holders of ARB tokens. Failure to comply with this restraining order by moving the funds prior to a final court decision may yield legal consequences and personal liability for members of the Arbitrum Security Council, Arbitrum DAO voters, and even individual Arbitrum token holders.
- Case Background: Han Kim and Yong Seok Kim – U.S. nationals whose family member (a South Korean pastor) was abducted from China and killed by North Korea – were awarded $15M each in compensatory damages and $300M in punitive damages against North Korea by a landmark 2015 ruling handed down by the United States Court of Appeals for the District of Columbia Circuit. Also included in the restraining order are plaintiffs to Kaplan v. Hezbollah and Calderon-Cardona v. DPRK, who used the precedent created by the aforementioned Kim case to obtain $169M and $378M in damages against North Korea for selling weapons to Hezbollah and supporting Japanese terror groups, respectively. Despite their judgments, plaintiffs have struggled to collect compensation from the isolated regime.
- Emergency Vacatur: Aave LLC (a software development entity affiliated with crypto lending market Aave), has filed an emergency motion to vacate the restraining notice served to Arbitrum DAO in its capacity as an "interested non-party." The group claims that thieves do not gain lawful ownership of stolen property, representing an immediate vacatur as necessary to prevent, "unfair prejudice and irreparable harm to both the Aave Protocol victims and other members of the digital assets community."
This is why the Arbitrum Security Council was not kind to the DAO. Lawyers for DPRK victims have now found a large pile of DPRK assets to seize to make good on a 2015 judgement against DPRK.
— PaperImperium (@ImperiumPaper) May 2, 2026
It appears a restraining order prohibiting the transfer of funds will complicate the… pic.twitter.com/P335TYlF71
