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FTX bankruptcy fees near $20 million for 51 days of work

FTX bankruptcy fees near $20 million for 51 days of work

The FTX logo on a laptop display.

Andrey Rudakov | Bloomberg via Getty Visuals

FTX’s prime bankruptcy, legal and financial advisors have billed the firm a lot more than $19.6 million in expenses for operate accomplished in 2022, in accordance to Tuesday individual bankruptcy court filings. Far more than $10 million of that was for work carried out in November 2022 as Sam Bankman-Fried’s crypto empire entered bankruptcy security in Delaware.

The corporations will initially only be paid out a minor around $15.5 million, or 80{0b5b04b8d3ad800b67772b3dcc20e35ebfd293e6e83c1a657928cfb52b561f97} of the worth of their work, underneath a court docket-requested interim compensation approach.

The legislation companies that billed FTX are Sullivan & Cromwell, Landis Rath & Cobb, and Quinn Emanuel Urquhart & Sullivan. Specialist advisor Alvarez & Marsal and fiscal advisor AlixPartners also billed the corporation.

Some of the function the firms billed for included taking conferences with other companies that also were being billing FTX for their time or corresponding with previous and latest executives, such as Caroline Ellison, the former CEO of Bankman-Fried’s hedge fund, Alameda Exploration.

Landis Rath & Cobb and Sullivan & Cromwell, FTX’s major lawful companies, billed the business a put together $10.7 million for much more than 8,400 several hours of work. Landis Rath & Cobb billed $1.16 million for work performed in between Nov. 11 and Nov. 30.

Sullivan & Cromwell, a target for both lawmakers and Bankman-Fried around the firm’s pre-petition function with FTX, sought much more than $9.5 million in compensation for about 6,500 billable several hours in the time period among Nov. 12 and Nov. 30. Around half of those billable several hours, totaling extra than $4.8 million, were being for the function of companions, who normally charge the highest hourly level.

Sullivan & Cromwell assigned additional than two dozen companions to FTX’s case, in accordance to the filings. Jim Bromley, a partner at Sullivan & Cromwell and a lead lawyer on the circumstance, billed more than 178 hours for the months concerning Nov. 12 and Nov. 30.

The legal filings provide a glimpse into the ferocious do the job advisors have performed to untangle FTX’s advanced website of accounts and slipshod accounting expectations. Sullivan & Cromwell legal professionals expended more than 1,900 hours in November on your own on perform connected to examining and recovering FTX’s world-wide asset base, in accordance to the filings.

Alvarez & Marsal, an advisory company, billed $1.9 million for in excess of 2,300 hours of function on “organization functions,” assembly with lawyers and FTX executives, examining FTX’s holdings applying blockchain explorers, and examining “cybersecurity eventualities.” Those people functions bundled numerous hours in November corresponding with and contacting Ellison, far more than 5 hours in a single working day imaging iPad files and other electronic products, and a initial-day hearing meeting get in touch with that lasted 2 1/2 several hours.

Quinn Emanuel, which billed above $1.5 million for operate performed in November and December, assigned additional than a dozen lawyers to the circumstance, nine of whom had been companions. One particular of individuals associates, Sascha Rand, billed about $13,000 for a one day’s get the job done in November, corresponding and reviewing initially-day issues. An additional Quinn law firm submitted for above $17,000 on a “non-doing the job journey” working day trip starting Nov. 21 and returning on Nov. 22.

AlixPartners, a monetary consulting business, billed $1.1 million for get the job done done above the study course of a tiny more than a month, from Nov. 28 to Dec. 31.

FTX’s advisors are not entitled to their full expenses still. Underneath an interim payment get, experienced advisors are paid out 80{0b5b04b8d3ad800b67772b3dcc20e35ebfd293e6e83c1a657928cfb52b561f97} of their filed service fees, provided that no objection is filed. Total payment for authorized and advisor expenses will not come about until finally a final charge software is submitted, every time FTX’s individual bankruptcy saga concludes.

That does not indicate that advisors will not likely get their because of, having said that. A 2019 Federal Reserve examine explained qualified and consulting costs in the Lehman Brothers’ individual bankruptcy saga totaled more than $2.56 billion.

Lawyers for Sullivan & Cromwell did $40,000 really worth of operate just to seem in FTX’s initially personal bankruptcy listening to on Nov. 22, dependent on courtroom filings of several hours billed and hourly costs.

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