The lawsuit centers on Fenwick's work for FTX between 2018 and 2022. The complaint draws on testimony from Nishad Singh, FTX's former engineering director who pleaded guilty and testified at Sam Bankman-Fried's criminal trial, as well as findings from a 2024 court-appointed bankruptcy examiner's report. According to the plaintiffs, the examiner concluded that Fenwick helped create FTX and Alameda's corporate structures, formed shell entities, drafted backdated agreements, and was "deeply intertwined" in the group's wrongdoing.
The case represents a significant expansion of FTX-related liability beyond insiders to outside professional advisers, targeting one of Silicon Valley's largest law firms. Attorneys should monitor how courts treat law firm exposure for facilitating client fraud, particularly where examiner reports and guilty-plea testimony establish the firm's role in structuring misconduct. The outcome could reshape professional liability standards for counsel advising high-growth fintech ventures.