1 year ago
A instrumentality steadfast that erstwhile provided services to FTX defended itself and attempted to disregard a people enactment suit done a ineligible filing connected Sept. 22.
The applicable suit began successful August. There, customers attempted to reason that Fenwick & West was successful portion liable for alleged fraudulent enactment astatine FTX.
In its existent filing, Fenwick defended itself connected assorted grounds. It argued that plaintiffs failed to allege that Fenwick acted extracurricular of the scope of representation.
Furthermore, Fenwick said that plaintiffs failed to amusement that Fenwick knew astir oregon straight assisted FTX’s fraud, and failed to amusement that oregon that Fenwick participated successful a Racketeer Influenced and Corrupt Organizations (RICO) enterprise.
Each of those points is indispensable to customers’ ineligible claims. Accordingly, Fenwick aims to person the people enactment suit dismissed done its latest ineligible filing.
Latest filing discusses finer points
Fenwick besides addressed different points. The instrumentality steadfast noted that plaintiffs did not reason that it “orchestrated” FTX’s fraud. Instead, plaintiffs repeatedly affirmed successful their assertion that erstwhile FTX CEO Sam Bankman-Fried was liable for that fraud.
Fenwick asserted that it represented lone FTX, not Bankman-Fried oregon immoderate different institution insider. It went connected to enactment that it was conscionable 1 of galore instrumentality firms that represented FTX and different described its services arsenic “routine” passim its filing.
The instrumentality steadfast besides responded to allegations that it provided definite services that went “well beyond” the services that instrumentality firms typically provide. Fenwick said that those arguable services progressive employing lawyers who freely near Fenwick to articulation FTX, creating companies done which Bankman-Fried aboriginal committed fraud, and advising FTX connected regulatory compliance arsenic related to cryptocurrency trading.
Fenwick noted that the plaintiffs bash not assertion that those services were incorrect oregon legally actionable successful their ain right. Instead, it said that the plaintiffs argued that Fenwick is liable due to the fact that it provided ineligible services portion it knew of FTX’s fraud.
Fenwick added that plaintiffs based definite arguments connected inferences astir the instrumentality firm’s monitoring and diligence policies, combined with the information that 2 Fenwick employees — Daniel Friedberg and Can Sun — near the instrumentality steadfast to enactment with FTX. To that end, customers successful their archetypal suit drew attraction to a 2021 email successful which Friedberg acknowledged cash-sharing betwixt FTX and its sister steadfast Alameda Research.
As with assorted different points, Fenwick denied that the beingness of this email plausibly shows that it was alert of alleged wrongdoing astatine FTX.
The station FTX’s one-time instrumentality steadfast denies consciousness of fraud, moves to disregard lawsuit appeared archetypal connected CryptoSlate.
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