Legal Fees in the FTX Bankruptcy Saga
The FTX bankruptcy case has proved to be a financial bonanza for law firms, investment banks, and consulting companies. In January alone, they billed the beleaguered crypto exchange a staggering $34.18 million. Yes, you read that right! It’s as if these firms are working in a dimension where legal labor is paid for in gold bricks.
Who’s Cashing In?
Leading the charge is FTX’s new chief restructuring officer and CEO, John J. Ray III, raking in $305,000 in February by charging $1,300 an hour. If that’s a rate set to make your accountant weep, just wait until you see the tab compiled by the lawyers.
- Sullivan & Cromwell: $16.9 million
- Quinn Emanuel Urquhart & Sullivan: $1.44 million
- Landis Rath & Cobb: $684,000
It’s like a legal buffet, but instead of all-you-can-eat, they’re serving all-you-can-bill.
A Labor of Billable Hours
According to the court documents, Sullivan & Cromwell’s trusty lawyers logged a jaw-dropping 14,569 billable hours. That’s over 600 days of work! Some legal eagles even demanded fees soaring to $2,165 per hour. Meanwhile, the firm’s paralegals are cashing checks ranging from $425 to $595 per hour. Talk about doing the cha-ching dance!
Where’s the Money Going?
Breaking down the outrageous bills shows that the most expensive services included:
- Discovery: $3.5 million
- Asset Disposition: $2.2 million
- General Investigation Work: $2 million
In the land of legal fees, every little detail seems to have a hefty price tag.
Keeping the Right Counsel
Ray, the new captain of the FTX ship, has argued vigorously for retaining Sullivan & Cromwell as legal counsel. He referred to the firm as integral to navigating the “dumpster fire” he inherited. His motion came after a U.S. Trustee raised concerns about the law firm’s previously undisclosed connections with FTX. Talk about a soap opera plot twist!
A Coalition of Consultants
As if lawyers weren’t enough, consulting firms felt the urge to jump in too. AlixPartners billed $2.1 million for its forensic analysis, while Alvarez & Marsal sent a bill for a jaw-dropping $12.5 million for 17,100 hours of investigative work. When you factor in the restructuring advice from Perella Weinberg Partners for another $450,000, the total is certainly adding up!
The Next Chapter of Legal Drama
As we gear up for FTX’s trial in October, the drama continues. Estimated fees could balloon to hundreds of millions, potentially challenging the infamous $440 million legal bill from the Lehman Brothers’ bankruptcy in 2008. Buckle up, folks! The legal world is in for a bumpy ride.
+ There are no comments
Add yours