Dec 21 (Reuters) – Bankrupt crypto change FTX has requested a U.S. chapter decide for permission to pay its prime restructuring legal professionals as a lot as $2,165 per hour, an unusually excessive charge for an organization that can’t afford to repay all of its money owed.
FTX declared chapter on Nov. 11, collapsing amid a wave of buyer withdrawals. Federal prosecutors have charged founder Sam Bankman-Fried with stealing billions of {dollars} in FTX buyer property to plug losses at his hedge fund, Alameda Analysis, and two of his former associates have already pleaded responsible. Bankman-Fried is scheduled to be arraigned in New York on Thursday.
New York-based legislation agency Sullivan & Cromwell is representing FTX in its Chapter 11 case and guiding its efforts to return property to prospects. FTX late Wednesday requested the Delaware federal decide overseeing the case for approval to pay the agency’s companions and particular counsel between $1,575 and $2,165 per hour for his or her work.
The highest legal professionals’ charges far exceed the $1,300 per hour billed by FTX’s new CEO John Ray, who additionally filed an software with the court docket late Wednesday.
Court docket-approved billing charges for chapter attorneys didn’t cross the $2,000-per-hour mark till earlier this yr, when a U.S. chapter decide accredited a $2,035-per-hour payment within the chapter of cosmetics large Revlon.
Chapter consultants have stated whole authorized charges in a case as complicated as FTX can exceed $100 million.
Bankman-Fried criticized Sullivan & Cromwell in draft congressional testimony he deliberate to ship earlier than his Dec. 12 arrest, claiming he was pressured into submitting for chapter at the least partly as a result of the case would ship giant authorized charges.
Sullivan & Cromwell didn’t instantly reply to a request for remark.
Earlier than FTX’s chapter, Sullivan & Cromwell represented the corporate in U.S. regulatory inquiries and on potential acquisitions, together with its proposed acquisition of bankrupt crypto lender Voyager Digital. The agency was paid $8.56 million for that pre-bankruptcy authorized work.
Reporting by Dietrich Knauth and Andrew Goudsward
Enhancing by David Bario and Nick Zieminski
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