Looks like the Wall Street law firm Sullivan & Cromwell is in for a big payout from the bankruptcy of crypto exchange FTX. According to Bloomberg, the firm has around 150 employees, 30 of whom charge more than $2,000 an hour for their services. Additionally, paralegals at the firm earn between $810 and $1,475 per hour.
when my financial time digest app sends me a notification for an article on sullivan & cromwell and ftx pic.twitter.com/eWZodvAb5h
— sean tatol (@sean_tatol) January 25, 2023
With such high rates and a large number of employees involved, legal costs for the case could easily reach into the hundreds of millions of dollars before the bankruptcy is completed. And with over 100 lawyers working on the case for 10 hours or more in November 2022 alone, those legal fees are adding up fast.
In November 2022 alone, more than 100 Sullivan & Cromwell lawyers were involved in the FTX case for at least 10 hours, according to Bloomberg.
Sullivan & Cromwell has more than 150 people working on the FTX case, including 30 partners with rates that exceed $2,000 per hour. Associates are billing between $810-1,475 per hour.https://t.co/giQDAyi1dO
— Bloomberg Law (@BLaw) January 27, 2023
This is in addition to the hourly rates of the new CEO of the exchange, John J. Ray, estimated at $1,300 per hour, and the hourly rates of the 25 partners at the law firm, which are estimated at $2,165 per hour.
To make matters worse, FTX's former chief legal officer and some creditors have even called for the firm to be removed from the case due to potential conflicts of interest. But despite all this, Sullivan & Cromwell is still set to make millions from the bankruptcy, thanks to market rates for top law firms and reduced rates compared to non-bankruptcy cases.
The Delaware judge overseeing @FTX_Official’s bankruptcy proceedings has approved Sullivan & Cromwell’s motion to be appointed debtors’ counsel, dismissing concerns that the white-shoe law firm has a conflict of interest in the case.@cheyenneligon reportshttps://t.co/r4VSr5jk2R
— CoinDesk (@CoinDesk) January 20, 2023
In fact, the firm already made $8.6 million from working with FTX over the past 16 months. And with big-name creditors like Apple, Amazon, and BlackRock listed in the court documents, the payout could be in the tens of millions. So, it's not hard to see why users are outraged.