Law agency Fenwick & West has denied accusations from an up to date class-action lawsuit alleging it was central to the crypto alternate’s fraud and eventual collapse.
Earlier this month, FTX customers requested to replace their swimsuit towards Fenwick, first filed in 2023, claiming new info from a chapter and prison case shared proof that the regulation agency “performed a key and essential function in crucial points of why and the way the FTX fraud was achieved.”
Fenwick informed a Florida federal decide in a submitting on Monday that the courtroom ought to deny FTX customers’ request to replace a swimsuit towards the agency, arguing their concept that it helped the alternate perform fraud “is as facile as it’s flawed.”
“Fenwick shouldn’t be responsible for aiding and abetting a fraud it knew nothing about, primarily based solely on allegations that Fenwick did what regulation corporations do each day — present routine and lawful authorized companies to their purchasers,” it stated.
Lawsuit makes use of “stale info,” Fenwick says
The new accusations towards Fenwick stem from a large multi-district class-action lawsuit filed by FTX customers after it collapsed in late 2022.
The group has additionally introduced claims towards celebrities and firms alleged to have labored with FTX, together with the regulation agency Sullivan & Cromwell, which the group later dropped for a scarcity of proof.
Fenwick argued the proposed up to date grievance is “premature — primarily based on stale info that has been out there to them for years — but in addition deceptive and futile.”
Fenwick additionally famous the allegations towards the agency “mirror” those they’d used “fairly aggressively” towards Sullivan & Cromwell, earlier than the group dismissed the motion after a report concluded that Sullivan didn’t find out about FTX’s fraud.
“They provide no credible purpose why the identical allegations ought to survive towards Fenwick,” it added.
“False characterization” of FTX government’s claims
Fenwick has additionally refuted that Nishad Singh, FTX’s lead engineer, had testified that Fenwick was conscious and helped conceal the “misuse of buyer funds” and “improper loans” throughout FTX co-founder Sam Bankman-Fried’s prison trial.
“Singh testified that Fenwick merely suggested on how one can construction founder loans, that are frequent devices for carefully held corporations like FTX,” the agency stated.
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It added that “dozens of witnesses” in Bankman-Fried’s trial testified that the fraud at FTX was carried out “with out the data of even FTX’s in-house counsel, different FTX staff, executives, and administrators, FTX’s long-time accountants, and different exterior regulation corporations and professionals that labored carefully with FTX. Fenwick is not any completely different.”
Fenwick rejects new securities claims
Meanwhile, Fenwick stated the proposed grievance’s new claims that it helped launch and promote the FTX Token (FTT) in violation of Florida and California securities legal guidelines have been far-fetched, frivolous and will have been “asserted months — if not years — earlier.”
“These new claims come far too late,” it wrote. “If Plaintiffs really thought they’d state securities claims towards Fenwick, they’d each alternative to allege them on the outset.”
It accused the group of including the 2 new allegations after a decide dismissed all however the state securities legal guidelines claims towards celebrities that allegedly promoted FTX.
“This is an eleventh-hour try and evade the Court’s ruling on the Celebrity Defendants’ movement to dismiss, and to recast attorneys as ‘promoters,’” Fenwick claimed. “But this concept too goes nowhere.”
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