FTX victims sue law firm Fenwick & West for $525 million

According to Bloomberg Law, a group of victims who lost their life savings in the collapse of the FTX exchange filed a lawsuit against the Silicon Valley law firm Fenwick & West LLP on May 14, seeking $525 million in damages.

The plaintiffs accuse the law firm, which served as FTX's primary external legal advisor for many years, of knowingly assisting FTX in violating fiduciary duties and misappropriating billions of dollars in customer assets, while also helping to set up shell companies and implement communication controls to cover up related evidence.

FTX founder Sam Bankman-Fried was arrested after the exchange's collapse in 2022 and was convicted on seven counts of fraud and money laundering, receiving a 25-year prison sentence.