  Belle has observed surprisingly copious production of $\psi(3770)$ in $B$
meson decay $B\to \psi(3770)K$, of which the rate is comparable to that of
$B\to \psi(3686)K$. We study this puzzling process in the QCD factorization
approach with the effect of S-D mixing considered. We find that the soft
scattering effects in the spectator interactions play an essential role. With a
proper parametrization for the higher twist soft end-point singularities
associated with kaon, and with the S-D mixing angle $\theta=-12^{\circ}$, the
calculated decay rates can be close to the data. Implications of these soft
spectator effects to other charmonium production in $B$ exclusive decays are
also emphasized.
