A Silicon Valley law firm has agreed to pay $54 million to settle allegations it helped FTX carry out an $8 billion fraud. Fenwick & West filed the preliminary settlement Monday in Miami federal court. The deal still needs a judge's approval.
The allegations against the firm
Plaintiffs accused Fenwick of doing more than just routine legal work for the crypto exchange. They said the firm actively crafted strategies that enabled the fraud and built legal structures that let FTX mix customer money with funds from Alameda Research, the trading arm run by Sam Bankman-Fried. That commingling, according to the lawsuit, was central to the scheme that cost customers billions.
The $54 million settlement covers claims that Fenwick went beyond its role as outside counsel. In court filings, plaintiffs described the firm's actions as essential to making the fraud work.
What Fenwick says
Fenwick maintains it had no knowledge of the fraud. The firm says it stands by the integrity of its legal work and disputes any wrongdoing. It employs more than 500 lawyers and is one of the best-known firms in tech and crypto law.
The settlement lets Fenwick avoid a trial and the risk of a much larger payout. But it doesn't end the firm's legal troubles.
A separate suit still active
A separate $525 million lawsuit against Fenwick and some of its partners remains active. That case was filed by the same plaintiffs but targets different conduct. It leaves significant financial exposure on the table for the firm.
David Boies, the litigator representing plaintiffs, said the $54 million settlement was reasonable. He argued it would spare both sides prolonged litigation and the uncertainty of a jury verdict. Boies is known for high-stakes cases, including representing the U.S. government in the Microsoft antitrust fight.
Where FTX stands now
Sam Bankman-Fried was sentenced in 2024 to 25 years in prison for stealing $8 billion from customers. He has appealed. The FTX bankruptcy estate has distributed over $5 billion to creditors. It completed a third creditor repayment round in September 2025 and operates under a court-approved compensation plan.
The $54 million from Fenwick would go into the pool of money available for victims. But the total losses were so large that any recovery is partial.
What happens next
The Miami federal judge overseeing the case will hold a hearing to decide whether to approve the $54 million settlement. If approved, the money will be paid into an account controlled by the bankruptcy estate. The separate $525 million suit against Fenwick and its partners will continue, with no trial date set yet.
