Judge Approves Sullivan & Cromwell to Be Debtors’ Counsel in FTX case

• Sullivan and Cromwell’s bid to be debtor’s council approved by a bankruptcy judge.
• The judge stated that he doesn’t see any concern about the conflicts of interest.
• The US trustee waived all her objections in this matter.

According to the latest reports, a bankruptcy judge has approved Sullivan & Cromwell’s bid to be the debtors’ council. The judge reportedly stated that he has no concerns about the conflicts of interest posed by the law firm’s former involvement with the FTX exchange.

The FTX event will go down in history as one of the most catastrophic events in the cryptocurrency realm. The $32 billion worth of industry collapsed in November, and the exchange reportedly owes a whopping $3.1 billion to its top 50 creditors. Sullivan & Cromwell, alongside Landis Rath & Cobb, are two of the bankruptcy lawyers for the FTX exchange.

Earlier this month, Judge John Dorsey passed a judgment regarding the creditor’s privacy, which was requested by Sullivan & Cromwell. The law firm requested that they wanted to protect the debtor’s customer list as an asset. On January 20, 2023, a bankruptcy court in Delaware also waved the green light to Sullivan and Cromwell to represent FTX during its bankruptcy proceedings.

Sullivan & Cromwell were facing opposition, and several controversies surfaced as the firm was set to have potential conflicts of interest, which made it unfit to be a part of the debtors’ council. Former FTX attorney Daniel Friedberg also filed a declaration containing numerous allegations of wrongdoing by the law firm when they previously worked with FTX.

However, Judge Dorsey dismissed all allegations and moved forward by appointing Sullivan & Cromwell as the debtors’ council.

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