Monday, March 20, 2023

Lawyers and advisors in FTX bankruptcy have billed nearly $20 million for 51 days of work

The FTX brand on a laptop computer display.

Andrey Rudakov | Bloomberg by way of Getty Images

FTX’s high chapter, authorized, and monetary advisors have billed the corporate greater than $19.6 million in charges for work accomplished in 2022, based on Tuesday chapter courtroom filings. More than $10 million of that was for work accomplished in Nov. 2022, as Sam Bankman-Fried’s crypto empire entered bankruptcy safety in Delaware.

The corporations will initially solely be paid a bit of over $15.5 million, or 80% of the worth of their work, beneath a court-ordered interim compensation plan.

The legislation corporations that billed FTX are Sullivan & Cromwell, Landis Rath & Cobb, and Quinn Emanuel Urquhart & Sullivan. Professional advisor Alvarez & Marsal and monetary advisor AlixPartners additionally billed the corporate.

Some of the work that the corporations billed for concerned conferences with different firms that additionally have been billing FTX for his or her time, or concerned corresponding with former and present executives, together with Caroline Ellison, the previous CEO of Bankman-Fried’s hedge fund, Alameda Research.

Landis Rath & Cobb and Sullivan & Cromwell, FTX’s major authorized corporations, billed the corporate a mixed $10.7 million for over 8,400 hours of labor. Landis Rath & Cobb billed $1.16 million for work accomplished between Nov. 11 and Nov. 30.

Sullivan & Cromwell, a goal for each lawmakers and Bankman-Fried over their pre-petition work with FTX, sought over $9.5 million in compensation for over 6,500 billable hours, within the interval between Nov. 12 and Nov. 30. Over a 3rd of these billable hours, totaling over $4.8 million, have been for the work of companions, who usually cost the best hourly fee.

Sullivan & Cromwell assigned over two dozen companions to FTX’s case, based on the filings. Jim Bromley, a companion at Sullivan & Cromwell and a lead legal professional on the case, billed over 178 hours for the weeks between Nov. 12 and Nov. 30.

The authorized filings supply a glimpse into the ferocious work accomplished by advisors to untangle FTX’s complex web of accounts and slipshod accounting standards. Sullivan & Cromwell attorneys spent over 1,900 hours in November alone on work associated to analyzing and recovering FTX’s global asset base, based on the filings.

Alvarez & Marsal, an advisory agency, billed $1.9 million for over 2,300 hours of labor on “business operations,” assembly with attorneys, FTX executives, analyzing FTX’s holdings utilizing blockchain explorers, and reviewing “cybersecurity scenarios.” Those operations included a number of hours in November corresponding with and calling Ellison, 5.3 hours in a single day imaging iPad recordsdata and different digital units, and a first-day listening to convention name that lasted 2.5 hours.

Quinn Emanuel, which billed over $1.5 million for work accomplished between November and December, assigned over a dozen attorneys to the case, 9 of whom have been companions. One of these companions, Sascha Rand, billed over $13,000 for a single day’s work in November, corresponding and reviewing first-day points. Another Quinn lawyer filed for over $17,000 on a “non-working travel” day journey starting Nov. 21, returning on Nov. 22.

AlixPartners, a monetary consulting agency, billed $1.1 million for work accomplished over the course of a bit of greater than a month, from Nov. 28 to Dec. 31.

FTX’s advisors aren’t entitled to their full charges but. Under an interim compensation order, skilled advisors are paid 80% of their filed charges, supplied that no objection is filed. Full compensation for authorized and advisor charges won’t happen till a closing payment software is filed, each time FTX’s chapter saga concludes.

That doesn’t suggest that advisors will not get their due, nonetheless. A 2019 Federal Reserve study mentioned skilled and consulting charges in Lehman Brothers’ chapter have been over $2.56 billion.

Lawyers for Sullivan & Cromwell did $40,000 value of labor simply to seem in FTX’s first bankruptcy hearing on Nov. 22, primarily based on courtroom filings of hours billed and hourly charges.

Prosecutors say Sam Bankman-Fried's contact with FTX employees suggests witness tampering

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