Joseph Bankman and Barbara Fried, parents of Sam Bankman-Fried, are seeking the dismissal of a lawsuit filed by the bankrupt FTX cryptocurrency exchange, which aims to recover funds allegedly fraudulently transferred.
The lawsuit, initiated in September 2023, sought to reclaim “millions of dollars” from Bankman and Fried. Despite their son’s subsequent conviction on charges of defrauding customers and the U.S., Bankman and Fried, both professors at Stanford Law School, argue that there was no fiduciary relationship with FTX.
They contend that even if such a relationship existed, FTX must show “actual knowledge” of actions leading to a breach of fiduciary duty, not merely that the parents “knew or should have known.” The lawsuit did not specify the total amount misappropriated, but detailed line items including Bankman’s salary, property expenses, and donations to Stanford University.