Binance subpoenas Kevin O’Leary, Michael Lewis in $1.76 billion FTX clawback fight

Binance and former chief executive Changpeng Zhao have subpoenaed Kevin O’Leary, author Michael Lewis, former Forbes researcher Steven Ehrlich and accounting firm BDO USA PC as they fight the FTX estate’s bid to claw back about $1.76 billion, according to a notice filed on November 4, 2026, in the US Bankruptcy Court for the District of Delaware.

FTX clawback lawsuit expands as Binance seeks additional evidence

The latest subpoenas indicate that Binance and Zhao are looking beyond the original transaction documents to gather information from individuals and organisations that had connections to FTX.

According to Bloomberg Law, the requests cover records and information from O’Leary, Lewis, Ehrlich, and BDO USA. The publication described the requests as seeking a host of records and information.

O’Leary’s involvement is particularly notable because he previously served as a paid promotional representative for FTX while also maintaining an investment position in the company.

His relationship with the exchange placed him among the public figures associated with its business operations before its eventual collapse.

Lewis, meanwhile, became closely associated with the FTX story through his research into Sam Bankman-Fried, the exchange’s co-founder. His book, Going Infinite: The Rise and Fall of a New Tycoon, examined Bankman-Fried’s business activities and personal life, drawing on considerable access to the former executive.

The FTX Recovery Trust is responsible for pursuing financial recoveries intended to benefit creditors affected by the exchange’s bankruptcy. Its efforts extend beyond Binance, with another substantial recovery action involving Genesis Digital Assets and related companies.

Kevin O’Leary and Michael Lewis have different FTX connections

The involvement of O’Leary and Lewis reflects two different relationships with the collapsed exchange.

O’Leary was an investor and promotional spokesperson for FTX before the company entered bankruptcy in November 2022. In December of that year, he disclosed details of his financial relationship with the exchange, including a promotional agreement valued at approximately $15 million.

He also revealed that he had invested around $9.7 million in cryptocurrency and held more than $1 million worth of FTX equity. Following the exchange’s collapse, he said his equity investment had become worthless.

These financial connections make his involvement in the latest evidence-gathering process particularly relevant to understanding the exchange’s promotional activities and business relationships before bankruptcy.

Lewis’s connection was primarily through journalism and publishing. While researching his book about Bankman-Fried, he spent considerable time with the former FTX executive, gaining access to information about his business operations and personal life.

Published in October 2023, almost a year after FTX filed for bankruptcy, the book became one of the prominent accounts examining the rise and collapse of the cryptocurrency company.

The request for information from these individuals suggests that Binance’s legal team is seeking a broader understanding of FTX’s operations, relationships, and activities surrounding the disputed transaction.

However, the subpoenas should not be interpreted as evidence that either O’Leary or Lewis participated in the alleged fraudulent transfer. Their inclusion in the proceedings is part of the evidence-gathering process.

The $1.76 billion transaction at the centre of the dispute

At the heart of the FTX Clawback Lawsuit is a share repurchase agreement reached in July 2021, when Binance and Zhao agreed to sell their ownership interests in FTX.

The transaction involved Binance’s 20% stake in FTX’s international business and an 18.4% interest in its United States parent company.

According to allegations presented by the FTX estate, Alameda Research, the trading company founded by Bankman-Fried, provided the funds used to complete the repurchase while FTX was already insolvent.

The payment was reportedly made using three digital assets: FTX’s native FTT token, Binance’s BNB token, and Binance USD (BUSD), a dollar-pegged stablecoin.

The recovery trust argues that the transaction constituted a fraudulent transfer because the funds allegedly originated from customer assets that should not have been used for the repurchase. The plaintiffs are therefore seeking to recover at least $1.76 billion from Binance and Zhao.

Binance and Zhao have challenged the allegations and sought to have the claims dismissed. Their legal position forms part of the continuing dispute over whether the 2021 transaction can be reversed through bankruptcy recovery proceedings.

The FTX Clawback Lawsuit has therefore become an important part of the wider effort to establish accountability for transactions conducted before the exchange’s collapse.

Court ruling keeps FTX recovery claims against Binance alive

The legal battle has already passed an important procedural stage. In an opinion dated July 24, Chief United States Bankruptcy Judge Karen B. Owens allowed key recovery allegations against Zhao and four Binance-related entities to proceed.

However, the ruling was not an outright victory for the FTX estate on every aspect of its complaint. The judge dismissed fraudulent-transfer claims against former Binance executives Samuel Wenjun Lim and Dinghua Xiao.

This means the central dispute over the $1.76 billion transaction remains unresolved and can continue through the legal process. A successful recovery action could return assets to the FTX estate, where they would become part of the broader distribution process.

The latest subpoenas could also help establish additional facts surrounding the transaction and the relationships between FTX, Binance, its former executives, and other industry participants.

The FTX Clawback Lawsuit is not the only recovery action being pursued by the trust. FTX has also filed a separate $1.15 billion clawback claim against Genesis Digital Assets and affiliated entities, alleging that investments funded through Alameda involved misappropriated customer money.

Together, these proceedings demonstrate the scale of the financial recovery effort following one of the cryptocurrency industry’s most significant corporate failures.

What the FTX clawback lawsuit means for crypto investors

The latest development is primarily a legal and financial recovery story rather than an immediate market-moving event.

Although the court has allowed important recovery claims against Binance and Zhao to proceed, this does not mean the plaintiffs have already secured the $1.76 billion they are seeking.

As the proceedings continue, the additional evidence requested from O’Leary, Lewis, Ehrlich, and BDO could provide further information about FTX’s business relationships and activities before its collapse.

The FTX Clawback Lawsuit remains an unresolved legal battle, with billions of dollars and the interests of affected creditors at stake. Its eventual outcome will help determine whether the disputed funds can be recovered and how much additional value may be returned to those affected by FTX’s bankruptcy.