FTX Customers Expand Lawsuit Against Fenwick & West Over $8 Billion Collapse
Former FTX clients have amended their lawsuit against Fenwick & West, the law firm that represented FTX.
Quick overview
- Former FTX clients have amended their lawsuit against Fenwick & West, alleging the firm was complicit in the fraudulent structures behind FTX's $8 billion collapse.
- The lawsuit claims Fenwick designed corporate structures that enabled the misuse of customer funds and lacked necessary safeguards.
- Testimonies from former FTX insiders suggest Fenwick was aware of illegal activities and provided advice on how to conceal them.
- Fenwick has denied all allegations and maintains it acted within the scope of its legal representation.
Former FTX clients have amended their lawsuit against Fenwick & West, the law firm that represented FTX. The August 11 filing claims Fenwick was involved in the fraudulent structures behind the $8 billion collapse. Using new evidence from Sam Bankman-Fried’s criminal trial and FTX’s bankruptcy proceedings, the plaintiffs say Fenwick was involved in “the most important parts” of how FTX’s fraud was carried out.
According to the complaint, Fenwick didn’t just advise FTX superficially but designed corporate structures that allowed the misuse and diversion of billions of customer funds. The lawsuit says these structures had no safeguards and enabled the massive misappropriation that led to FTX’s collapse.
Concealment and Legal Complicity
The amended complaint accuses Fenwick of providing “substantial assistance” to FTX by creating and endorsing corporate entities that hid asset transfers. Key points include Fenwick representing multiple “conflicted” entities, including Alameda Research and its subsidiary North Dimension, which operated without controls to prevent abuse.
Former FTX insiders Nishad Singh, Gary Wang, and Caroline Ellison testified that Fenwick was aware of illegal loans, false disclosures, and customer fund misuse. Singh told the court he informed Fenwick about these issues and Fenwick advised him on how to cover it up.
FTX USERS SEEK TO EXPAND LAWSUIT AGAINST FENWICK & WEST
FTX customers push to update their class action lawsuit, targeting law firm Fenwick & West over its alleged critical role in FTX’s fraud.
New facts from Sam Bankman-Fried’s recent trial and FTX’s bankruptcy are requested…
— CryptoEdge (@EdGeraldX) August 12, 2025
The filing also cites an independent bankruptcy examiner who reviewed over 200,000 documents. The examiner found Fenwick had “very close relationships” with FTX leadership and was “deeply involved” in the misconduct. The report says Fenwick created shell companies to hide transactions and auto-deleting Signal chat channels used by executives to hide communications.
Plaintiffs also allege Fenwick engaged in “concealment practices” that regulators later called obstruction, knowing these actions would mislead investors and authorities.
New Securities Claims and Fenwick’s Response
The lawsuit adds new claims under Florida and California securities laws, accusing Fenwick of actively promoting and facilitating unregistered sales of FTX tokens like YBAs and FTT tokens to residents in those states.Fenwick has been under the microscope throughout Bankman-Fried’s trial with testimony showing the firm drafted payment agent agreements for Alameda’s bank accounts—key pipes for customer deposits. Bankman-Fried also testified Fenwick knew about executives’ use of encrypted, auto-deleting chats and he relied heavily on the firm’s advice.
Fenwick & West says it’s innocent. In a September 2023 motion to dismiss, the firm said it was acting within the scope of its representation and denied all allegations in the original complaint.
This amended lawsuit puts the spotlight on the broader accountability of legal advisors in crypto scandals. As the litigation plays out, Fenwick’s role will shape the legal landscape for digital assets and corporate governance.
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