Monday, October 2, 2023

According to recent court filings, Voyager Digital Holdings, currently insolvent, and its creditor committee have accumulated legal expenses totaling $16.5 million from July 22, 2022, through May 18, 2023. Between March and May 2023 alone, the estate was billed approximately $5.17 million in legal fees.

Profits for Lawyers and Restructuring Officers Surge Amidst Crypto Bankruptcy Cases

Attorneys representing Voyager’s creditor committee recently disclosed the legal costs associated with the ongoing bankruptcy proceedings, which began in July 2022. On July 3, 2023, the filing unveiled a compensation request of $5.17 million for the third interim fee period (March-May 2023). The document states that this is the final provisional fee application submitted by the law firm McDermott Will & Emery LLP.

The filing further reveals that the interim compensation order was granted by the court on August 4, 2022. The attorneys explain that Voyager’s Chapter 11 case was the first to commence after a series of events in the cryptocurrency industry collectively referred to as the “crypto winter.” McDermott outlines that their litigation team provided counsel to the committee throughout the fee period, covering various complex matters aimed at maximizing recoveries for general unsecured creditors.

Their responsibilities involved advising the committee, participating in meetings and negotiations, and taking necessary actions to safeguard the committee’s interests. Additionally, in April, Voyager Digital incurred $1.1 million in legal fees billed by its law firm Kirkland & Ellis. Attorneys from Celsius, 3AC, Voyager, and FTX are also reportedly benefiting financially from these bankruptcy cases. John J. Ray III, the CEO of FTX, is said to earn $1,300 per hour supervising his firm’s bankruptcy and restructuring efforts.

The question arises: should cryptocurrency companies be held accountable for the exorbitant legal and restructuring costs incurred during bankruptcy proceedings, or are these expenses an unavoidable consequence of the industry’s complexities? We invite you to share your thoughts and opinions on this matter in the comments section below.

Frequently Asked Questions (FAQs) about bankruptcy battle

Q: What are the total legal expenses incurred in Voyager Digital’s bankruptcy battle?

A: The total legal expenses accumulated from July 22, 2022, through May 18, 2023, amount to $16.5 million.

Q: Which law firms are involved in the bankruptcy proceedings?

A: The law firm McDermott Will & Emery LLP has provided legal counsel throughout the Chapter 11 cases, while Kirkland & Ellis has also billed Voyager Digital $1.1 million in legal fees.

Q: Are lawyers and restructuring officers profiting from the cryptocurrency bankruptcy cases?

A: Yes, lawyers and restructuring officers involved in Voyager Digital’s bankruptcy proceedings, as well as those from firms like Celsius, 3AC, Voyager, and FTX, are reportedly reaping significant financial rewards from these cases.

Q: Was Voyager Digital’s bankruptcy the first to occur following the “crypto winter”?

A: Yes, according to the filing, Voyager’s Chapter 11 case was the first to commence after a series of events in the cryptocurrency industry collectively known as the “crypto winter.”

Q: Should cryptocurrency companies be responsible for the high legal and restructuring costs during bankruptcy?

A: There is room for debate. Some argue that the complexities of the industry justify these costs, while others believe that companies should be held accountable for managing their affairs more responsibly.

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CryptoTrader007 July 5, 2023 - 3:59 pm

So, Voyager Digital was the first to go bankrupt after the crypto winter. Guess they weren’t prepared for the storm. But seriously, $5.17M legal fees in just a few months? Talk about bleeding money. Hope other companies learn from this and manage their finances better.

CryptoEnthusiast123 July 5, 2023 - 8:21 pm

wow, $16.5M legal expense for Voyager Digital’s bankruptcy?! that’s insane! Lawyers cashing in big time. But shouldn’t companies be held accountable for these costs? It’s the price they gotta pay for playing in this crazy crypto industry!

CryptoExpert22 July 6, 2023 - 5:33 am

McDermott Will & Emery, Kirkland & Ellis, these law firms are makin’ bank with all these bankruptcy cases! And don’t even get me started on the lawyers from Celsius, 3AC, Voyager, and FTX. Cha-ching! Who knew bankruptcy could be so lucrative?


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