Fenwick West to pay $54 million to settle FTX fraud lawsuit

Fenwick West, a prominent Silicon Valley law firm, has agreed to pay $54 million to settle claims that it helped facilitate the fraud that led to the collapse of the cryptocurrency exchange FTX. The proposed settlement was filed Friday in federal court in Miami and requires approval from U.S. District Judge K. Michael Moore.

The class action lawsuit, brought by FTX customers who lost funds in the exchange’s 2022 bankruptcy, alleged that Fenwick West went beyond standard legal advice. Plaintiffs accused the firm of helping to design the corporate and financial structures that allowed customer money to be diverted to FTX’s sister trading firm, Alameda Research. The commingling of assets has been described by prosecutors and regulators as central to the fraud, which resulted in billions of dollars in customer losses.

Fenwick West did not admit any wrongdoing as part of the settlement. In a statement, the firm said it was not aware of the fraud at FTX and stood by the integrity of its legal work. The firm, which employs more than 500 lawyers, said it looked forward to putting the matter behind it. Attorneys for the FTX customers, including prominent litigator David Boies, told the...