FTX defends move to appoint law firm Sullivan & Cromwell as advisor

Bankrupt crypto speech FTX filed a Jan. 17 effect — authored by Sullivan & Cromwell (S&C) lawyers — to the objections surrounding its retention of the instrumentality steadfast arsenic an advisor.

FTX said the instrumentality firm’s relation astatine the bankrupt speech was of “critical importance,” citing however its accusation sharing with U.S. prosecutors and regulators led to the charge and apprehension of Sam Bankman-Fried (SBF) and his accomplices.

According to the filing, claims that S&C’s erstwhile advisory relation with the speech could pb to a imaginable conflict of interest were mendacious arsenic it has performed a conflicts cheque process that showed it was a “disinterested person” successful the case.

SBF antecedently accused the instrumentality steadfast of pressuring him to record for bankruptcy due to the fact that of the imaginable fees it stood to earn.

FTX CEO, unsecured creditors enactment Sullivan & Cromwell retention

Separate Jan. 17 filings from FTX CEO John Ray III and the Official Committee of Unsecured Creditors supported the determination to clasp Sullivan & Cromwell.

Ray said the S&C squad was indispensable successful bringing bid to a chaotic situation, adding that helium has besides employed a caller instrumentality steadfast to service arsenic counsel connected matters to which S&C mightiness beryllium conflicted.

Ray concluded:

“If the retention of immoderate of S&C, Quinn oregon Alix were to beryllium denied, constricted oregon impaired for immoderate reason, the involvement of the Debtors’ customers and creditors, arsenic good arsenic the authorities and national regulators and prosecutors with whom these advisors prosecute connected a regular basis, would beryllium severely, if not irreparably harmed.”

On the different hand, FTX’s unsecured creditors said the U.S. Trustee’s objections were based connected a misinterpretation of the Bankruptcy code.

The creditors added that it has nary objection to the retention of S&C due to the fact that the instrumentality steadfast has performed a important magnitude of enactment and its efforts were integral to the cases. The creditors further argued that nonaccomplishment to clasp the steadfast would not beryllium successful the champion interests of the estates.

Additionally, the creditors said the steadfast has commenced its probe into FTX’s downfall and “is moving tirelessly to uncover the fraud successful its entirety (and) retrieve arsenic galore assets arsenic possible.”

The station FTX defends determination to name instrumentality steadfast Sullivan & Cromwell arsenic advisor appeared archetypal connected CryptoSlate.