Fenwick & West, a respectable Silicon Valley law establishment, recently stood its ground against charges of its alleged part in a fraud involving the insolvent crypto marketplace, FTX. Arguing its innocence, the firm requested the court to dismiss the lawsuit. Fenwick & West maintained that its services given to FTX were strictly in the legal realm and that it had zero awareness of any fraudulent undertakings, a statement initially reported by Bloomberg.
In shining a light on these allegations, Fenwick’s legal crew, under the leadership of partner Kevin Rosen, pinpointed that its services for FTX could be boiled down to three basic acts: including hiring lawyers who would later become part of FTX, establishing corporations utilized by co-founder for business dealings, and dispensing advice on regulatory compliance related to cryptocurrency dealing.
The motion strongly underlined that a lawyer’s representation of a client and acquaintance with its employees does not entail their involvement in the client’s internal operations. Fenwick & West refuted the plaintiff’s argument that it should be responsible for providing “routine” and legitimate legal services which apparently have facilitated fraudulent schemes. They accentuated that such an argument on liability seemed to go against the principles of the legal profession.
Sustaining a respectable image through collaborations with esteemed Silicon Valley tycoons such as Apple, Oracle, and Facebook, Fenwick underscored its reputation and integrity in its motion. It was brought up that plaintiffs seemed to be fumbling to hold the firm liable for damages springing from the failure of one client, FTX, yet ignorant of concrete legal justifications.
FTX spectators who were negatively impacted by the November 2022 downfall have led to a multidistrict litigation in the US District Court for the Southern District of Florida. Within this legal combat, they are determined to make Fenwick answerable for its relations with the cryptocurrency market. Here, Fenwick was noted to have been a guiding firm counsel for FTX, providing counsel on transactions, tax matters, and litigation.
With Fenwick under legal scrutiny for its engagement with FTX, we realize how complex the world of cryptocurrency is. While this case advances, it is a stark reminder that all parties involved in this revolutionary technology, from accounting firms to celebrity endorsers, are bound to be tested as the crypto-community seeks compensation for their losses.
All in all, this lessens the limelight on the cryptocurrency itself, shifting the focus more towards the sides involved and their accountability.
Source: Cryptonews
