Fenwick & West, the prominent Silicon Valley law firm that served as FTX US’s main outside counsel, has agreed to pay $54 million to settle customer claims accusing it of helping enable the fraud that led to the exchange’s 2022 collapse. The preliminary settlement, filed in federal court in Miami before U.S. District Judge K. Michael Moore, is the largest in a second wave of FTX class-action settlements and still requires judicial approval.
The deal, reached without an admission of liability, will see Fenwick & West deposit the funds into escrow within 120 days of initial approval. The money will cover investor claims, administrative expenses, and approved attorneys’ fees. Plaintiffs, represented by attorneys including David Boies, argued the settlement avoids the costs and delays of prolonged litigation. The agreement resolves a 2025 lawsuit alleging Fenwick crafted complex corporate structures that obscured the flow of funds between FTX and its sister trading firm, Alameda Research, and assisted with compliance and licensing strategies that enabled customer funds to be moved at will.
The filing also includes a $11.75 million settlement with auditor Prager Metis and a $420,000 deal with former NBA player and FTX promoter Udonis Haslem. These add to 15 earlier settlements preliminarily approved between December 2024 and July 2025, which covered figures like Sam Bankman-Fried, Caroline Ellison, and Gary Wang. The plaintiffs are seeking certification for a class covering millions of users who held crypto or fiat on FTX, participated in yield products, or bought the exchange’s token, FTT. A proposed distribution plan, handled by JND Legal Administration, would pay claimants after deducting recoveries already received from the FTX bankruptcy estate, which has returned more than $5 billion to creditors. Crypto losses would be valued at CoinGecko prices as of May 14, while FTT tokens are credited only at documented purchase price, with any free FTT valued at zero.
Despite the Miami settlement, Fenwick & West still faces a separate $525 million civil suit in Washington, D.C., filed by 20 international victims alleging malpractice, fraud, and gross negligence. That case remains active, meaning the $54 million deal resolves only part of the firm’s FTX-related exposure. Meanwhile, former FTX Europe head Patrick Gruhn has launched UpsideOnly, an AI-powered trading platform via Perpetuals.com Ltd., promising profits from the company’s own capital based on crowdsourced predictions and a proprietary algorithm called BayesShield.
