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FTX lawyers to reap millions from the bankruptcy case: Report

  • February 10, 2023

According to a new report, the controversial law firm Sullivan & Cromwell is on track to reap a fortune from its work on the FTX cryptocurrency exchange’s bankruptcy case.

Sullivan & Cromwell’s costs in the FTX case are estimated to reach hundreds of millions of dollars before the firm’s bankruptcy investigation is over, Bloomberg Law reported on Jan. 27.

As the FTX trial is scheduled for October 2023, the firm’s lawyers now have about eight months to untangle the complicated FTX case, which will cost a lot of time and money. Sullivan & Cromwell has more than 150 people working on the FTX case, including 30 partners with rates exceeding 2,000 per hour. The report notes that associates are charging up to about $1,500 per hour, citing a court filing.

Source: Bloomberg Law

In a court declaration, Sullivan & Cromwell said that its proposed fees are in accordance with market rates by other leading law firms and actually represent a discount from the rates used in non-bankruptcy matters.

Bankruptcy experts have been facing a high demand as the crypto winter of 2022 generated many bankruptcy filings, including those by major crypto firms like Genesis Global Trading, Celsius Network and Voyager Digital.

According to Jonathan Lipson, a Temple University law professor, lawyers are going to do very well in cases like FTX, “just as the professionals have done very well in other big cases.” For example, New York-based law firm Weil Gotshal made about $500 million in fees from the bankruptcy of Lehman Brothers in 2008.

Lipson said that such big expenses can be justified as Sullivan & Cromwell can potentially help investigators recover money from FTX, stating:

“The important question is never are the lawyers charging a lot. It’s, is it worth it? If they can recover a lot of

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