FTX customers have substantially amended their lawsuit against the law firm Fenwick & West, leveraging critical new evidence unearthed during the criminal trial of former CEO Sam Bankman-Fried.
The amended complaint incorporates testimony and findings implicating Fenwick & West in structuring and facilitating FTX’s fraudulent activities. Insiders, including FTX co-founder Nishad Singh, testified during Bankman-Fried’s trial about the firm’s role. Furthermore, an independent examiner in FTX’s bankruptcy highlighted Fenwick & West’s ‘exceptionally close relationships’ with FTX executives and its facilitation of conflicted actions.
The lawsuit now alleges Fenwick & West actively aided FTX’s fraud by creating shell companies, structuring transactions to mislead investors and regulators, and designing and promoting deceptive financial instruments.
Fenwick & West previously moved to dismiss the original complaint, asserting it cannot be held liable for client wrongdoing and citing insufficient evidence against the firm directly. The updated lawsuit directly challenges this argument with the newly presented evidence.