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A US judge approved FTX's hiring of Sullivan & Cromwell as legal advisers in its bankruptcy case aafter the collapsed crypto exchange had resolved the U.S. Department of Justice's concerns about potential conflicts of interest.
The US Trustee and two of FTX's creditors had asked U.S. Bankruptcy Judge John Dorsey in Wilmington, Delaware not to approve FTX’s hiring of New York law firm Sullivan & Cromwell. They argued that the law firm had not disclosed sufficient information about its past ties to FTX, which includes U.S. general counsel, Ryne Miller, being a former partner at the firm.
According to Dorsey, the objectors failed to show there was an active conflict of interest between FTX and the firm. He added that if conflicts could arise, there were procedures in place to deal with them.
Ex-FTX attorney Daniel Friedberg had also opposed Sullivan & Cromwell's hiring, saying the law firm had overbilled for legal work and had conflicts of interest stemming from its connections to Miller.
Warren Winter, an FTX creditor, requested that Dorsey postpone the firm's approval so that Friedberg's claims could be looked at.
The judge rejected the request, stating that Friedberg's court submission was "filled of hearsay, innuendo, speculation, and rumors" and had not been properly presented to the court.
In November, FTX sought bankruptcy protection, claiming it was unable to fully reimburse consumers who had made deposits on its exchange.
