Law firm Sullivan & Cromwell’s fees on behalf of FTX in the exchange’s bankruptcy case are likely to reach hundreds of millions of dollars before the process itself is complete. Bloomberg Law writes about it.
The estimate is based on hourly rates for its professionals, which range from $1395 to $2165, according to court documents.
Sullivan & Cromwell stressed that the proposed fee schedule is in line with the market and actually represents a discount compared to unrelated bankruptcy cases.
The trial is scheduled for October 2023. The firm’s lawyers will have eight months to work out all the nuances.
The agency pointed to the increased demand for bankruptcy experts amid the collapse of firms such as Genesis Capital, Celsius Network and Voyager Digital.
According to Temple University law professor Jonathan Lipson, lawyers in similar FTX cases “will be successful.” He recalled Weil Gotshal’s ~$500 million in fees for its involvement in the Lehman Brothers bankruptcy in 2008.
The expert called the large outlay for Sullivan & Cromwell’s services, which could potentially help the investigation, “justifiable.”
“The important question is not whether lawyers charge a lot, but whether it is justified. If they can get a lot of money back, it’s probably worth it,” he explained.
On January 19, the court approved the retention of Sullivan & Cromwell as FTX’s legal team, despite controversy that the firm had a potential conflict of interest in the case because it had advised FTX prior to the platform’s bankruptcy proceedings.
To recap, FTX’s lawyers provided a detailed 100-plus page list of the exchange’s creditors. Among them were Apple, Google, Amazon, Coinbase, The New York Times and others.
Earlier, the attorneys asked the court to allow Sam Bankman-Fried, his family and some of the company’s former top executives to be subpoenaed “as part of an effort to collect debts.”
