Lawfirm Cuts $54M Deal With FTX Customers After Lead Counsel Allegations

The proposed settlement was filed this week in the Southern District of Florida and requires final approval from U.S. District Judge K. Michael Moore. The agreement does not admit wrongdoing by the firm.

Plaintiffs alleged Fenwick went well beyond standard legal advice, claiming the firm helped craft strategies that enabled FTX to commingle customer funds with those of Alameda Research, the affiliated trading firm controlled by FTX founder Sam Bankman-Fried. They described the firm’s alleged role as creating “shadowy entities” and legal structures that obscured the misuse of customer assets.

Fenwick wholeheardily denied the allegations. The firm said it was not aware of any fraud at FTX, stands by its legal work, and agreed to settle in order to move forward with its business.

The lawsuit is part of the broader multidistrict litigation known as In Re: FTX Cryptocurrency Exchange Collapse Litigation. Attorney David Boies represented plaintiffs in the case. Fenwick initially sought dismissal before engaging in settlement talks.

Under the terms, the $54 million will be deposited into an escrow account within 120 days of initial court approval. Plaintiffs’ attorneys said the deal was reasonable given the complexity and cost of continued litigation.

FTX collapsed in November 2022, triggering bankruptcy and exposing a fraud that wiped out billions in customer funds. Bankman-Fried was sentenced in 2024 to 25 years in prison for stealing roughly $8 billion from customers.

The Fenwick agreement is part of a second wave of class-action settlements tied to the FTX collapse. Earlier deals involved FTX executives Caroline Ellison, Nishad Singh, and Gary Wang, as well as celebrity promoters. Auditor Prager Metis separately agreed to pay approximately $11.75 million in related resolutions, pushing combined professional services payouts to roughly $66 million.

For FTX victims, the settlement adds to a stream of partial recoveries that remain small relative to total losses. Professional services firms associated with the now-defunct exchange have faced growing scrutiny since the collapse over how much they knew and what role, if any, their work played in enabling the fraud.

The Fenwick deal does not resolve all claims against the firm. A separate lawsuit filed in May 2026 in a Washington, D.C. federal court by roughly 20 individual FTX victims from multiple countries remains active. That case names Fenwick, along with several current and former partners, and seeks compensatory damages, return of legal fees paid by FTX, and punitive damages.

The D.C. suit makes similar allegations, arguing the firm’s legal work enabled the misappropriation of customer funds and helped FTX avoid regulatory oversight. Final court approval of the $54 million class-action settlement is still pending. Until Judge Moore signs off, no funds will be distributed to the class of former FTX customers.