Legal Eagles Soar: How FTX Bankruptcy Lawyers And Consultants Are Raking In Tens Of Millions

The group of professionals assigned to the FTX bankruptcy case billed a total of $38 million plus expenses for their services in January.

The bankruptcy administrators have hired the law firm Sullivan & Cromwell as their primary counsel, along with Quinn Emanuel Urquhart & Sullivan and Landis Rath & Cobb as special counsel for the proceedings.

AlixPartners, a consultancy firm, was also retained to conduct forensic analysis on FTX's DeFi products and tokens.

To sort through FTX's accounting records and determine which assets can be sold, financial services firms Alvarez & Marsal and Perella Weinberg Partners were retained.

Sullivan & Cromwell billed $16.8 million, Quinn Emanuel Urquhart & Sullivan billed $1.4 million, and Landis Rath & Cobb billed $663,995 for their services in January, according to court records.

The three firms collectively have over 180 lawyers and 50 non-lawyer staff assigned to the case.

Sullivan & Cromwell spent the most time on discovery, followed by asset disposition and analysis and recovery. Initially, the U.S. Department of Justice objected to Sullivan & Cromwell's hiring, claiming potential conflicts of interest.

FTX founder, Sam Bankman-Fried, also objected to the law firm's hiring, alleging that its staff had pressured him into filing for bankruptcy in November.

However, a Delaware bankruptcy court judge approved the firm to continue representing FTX in late January.

Quinn Emanuel Urquhart & Sullivan spent most of their billed time on asset analysis and recovery, while Landis Rath & Cobb spent a significant amount of time on hearings, litigation, and asset disposition.

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AlixPartners billed $2.1 million for their work, while Perella Weinberg Partners billed their monthly fee of $450,000 and spent a significant amount of time developing a restructuring strategy and corresponding with third parties. Alvarez & Marsal billed $12.3 million, with their largest items billed for avoidance actions, financial analysis, and accounting.

In November, interim CEO John J. Ray III described the FTX situation as "unprecedented" and a "complete failure of corporate controls and such a complete absence of trustworthy financial information."

Ray submitted a bill for $305,565 for his work in February.

In January, a bankruptcy judge approved the sale of FTX assets LedgerX and FTX Japan to create liquidity to pay back creditors.

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