FTX, one of the leading cryptocurrency exchanges in the world, recently filed for bankruptcy, leading to a legal circus of epic proportions. The collapse of the exchange has sparked a frenzy of legal activity, with court documents revealing the exorbitant costs of the FTX bankruptcy case so far. FTX’s bankruptcy, legal, and financial advisors have billed the firm more than $19.6 million for services rendered in 2022, a staggering amount that reflects the magnitude of the legal battle. The defense team is massive, consisting of 151 personnel, including lawyers, accountants, and strategic advisors, all working to resolve the case.
The FTX bankruptcy case has attracted significant attention from the media, with many observers closely following the proceedings. The legal circus has been fueled by the magnitude of the case and the complexity of the issues involved. With a huge network of 100 entities to deal with at the transactional level when it comes to accounting compliance, the case has been a massive undertaking for all involved. The Alvarez and Marsal council has invested 7925 hours in the case, mainly exploring the blockchain to follow the tracks of money and conducting interviews with key figures in the case, such as Caroline Ellison (Alameda Research).
The Legal Bill So Far
The legal bill has been significant, with work done immediately after FTX’s collapse resulting in a billing of $10 million at the end of November. The Sullivan & Cromwell firm has made up the bulk of the current legal bill, billing the whopping $6.28 million for its 6,500 hours of work between November 12 and 30. Half of this bill was used to pay for the work of the firm’s senior partners, who charge extreme prices. One of the biggest outings is a $40,000 bill for a day of representation at FTX’s first bankruptcy hearing.
The Complexity of the FTX Case
The enormous legal bill is linked to the immense complexity of the case, with a huge network of 100 entities to deal with at the transactional level when it comes to accounting compliance. The Alvarez and Marsal council saw 7925 hours invested in the case, mainly exploring the blockchain to follow the tracks of money and conducting interviews with key figures in the case, such as Caroline Ellison (Alameda Research). A bill for $6.28 million has been drawn up.
The Frenzy of the FTX Case
Dizzying legal bills are not uncommon in business bankruptcy cases, with the Lehman Brothers bankruptcy saga costing a whopping $2.56 billion. However, the statements of fees in the FTX case show the frenzy that has gripped the case, despite being a saga about returning funds to creditors, not squeezing all the juice out of the lemon. Bankruptcy Judge John Dorsey is currently considering the appointment of an independent reviewer in the case, which would be worth an extra $100 million, according to Sam Bankman-Fried.
Conclusion:
The FTX bankruptcy case continues to make headlines, with the legal circus reaching new heights in terms of cost. The complexity of the case and the sheer number of entities involved have contributed to the exorbitant legal bill, with several law firms and advisors billing millions of dollars for their services. The magnitude of the case and the frenzy surrounding the legal proceedings have made it one of the most talked-about business bankruptcy cases in recent history.
While such legal bills are not uncommon in business bankruptcy cases, the FTX case serves as a reminder of the high cost of resolving such legal battles.
