FTX Bankruptcy Lawyers and Advisers Receive $32.5M in Compensation for February Services

The legal costs incurred by the bankrupt cryptocurrency exchange FTX in February 2023 have been released, and they remain a cause of concern for the company’s debtors.

Court documents from April 4 to April 10, 2023, show that the law firms involved in FTX’s bankruptcy proceedings billed almost $32.5 million for February 2023.

Quinn Emanuel Urquhart and Sullivan, a legal firm involved in the proceedings, requested reimbursements exceeding $2.7 million for the month of February.

Hourly rates for partners at the firm ranged from $1,246 to $1,917, while those for associates ranged from $747 to $1,183. The firm billed a total of over 2,610 hours.

Filings made on April 4, 2023, revealed that Alix Partners, the forensic investigation consultant, and Alvarez and Marsal, the law firm, had fee statements totaling over $11.9 million and around $3.6 million, respectively, for the month of February.

Sullivan and Cromwell, with their expanding team of attorneys and associates, billed a total of over $13.4 million for the work they did for FTX in February, demanding the biggest sum among all firms involved in the bankruptcy proceedings.

One bankruptcy co-counsel, Landis Rath and Cobb, invoiced $582,604 for their services in February. Perella Weinberg Partners, an investment banking firm, billed a much smaller $77,891 for their services in the same period.

However, as per a court filing from March, the amount of almost $32.5 million did not include the compensation of John J. Ray III, the restructuring chief and CEO, who received $305,000 in February. A document filed on April 10 disclosed that John J. Ray III’s total fees and costs for March amounted to $329,173.

From March 1 to March 31, 2023, the FTX chief reported working for 255.9 hours and earning $1,300 per hour, which amounted to a fee of $327,470. Only $1,703 was left for his travel, housing, food, and other expenses.

FTX customers who are still awaiting compensation are struggling to come to terms with the fees, reimbursements, and costs paid by the company to its large team of attorneys, associates, paralegals, accountants, investigators, directors, and executives.

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