What happened
Fenwick & West, a Mountain View-based law firm that counted FTX among its clients, has agreed to pay $54 million to resolve a customer class action accusing it of aiding and abetting the fraud at Sam Bankman-Fried's exchange. The proposed settlement was filed Friday in the US District Court for the Southern District of Florida, according to Bitcoinist, which first reported the figure.
The agreement covers a putative class of FTX customers who lost funds when the exchange collapsed in November 2022. Plaintiffs argued Fenwick's legal work, including advice on corporate structuring between FTX and affiliated trading firm Alameda Research, gave the exchange cover to operate in ways that ultimately harmed customers. Fenwick has denied wrongdoing and the settlement contains no admission of liability.
The deal still needs preliminary and final approval from the federal judge overseeing the consolidated customer litigation in Miami.
Why it matters
This is one of the larger single-defendant settlements paid by an FTX adviser to customers directly, separate from recoveries the bankruptcy estate has clawed back from insiders and counterparties. The customer class action track has been the slower of the two recovery channels, and a $54 million number puts a price on the theory that outside professionals - lawyers, accountants, bankers - can be held to answer for what their client did with their advice.
It also sets a reference point. Other firms that served FTX, including auditors and venture investors, are facing parallel customer suits. A settlement at this level, if approved, tells the next defendant what a negotiated exit looks like.