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Companies Free Speech Systems, Llc FollowDec 19 (Reuters) - Conspiracy theorist Alex Jones on Monday asked a judge to allow him to take a $1.3 million annual salary from the bankrupt parent company of his Infowars' website. Jones drew a $1.3 million salary from Free Speech Systems before its bankruptcy, and his attorney asked U.S. Bankruptcy Judge Christopher Lopez to restore his salary to that level at a hearing Monday. Free Speech System's monthly revenue has dropped to $1.9 million from pre-bankruptcy levels of $6 million to $7 million, attorneys from the company said, adding that it currently has about $1.8 million in cash. Marty Brimmage, an attorney for the Sandy Hook families, opposed Jones' request for an increased salary. Lopez said he is "open to increasing" Jones' pay but did not have enough evidence to make a ruling yet.

☆ FTX bankruptcy judge to hear media companies' request to reveal customer names
▼ + stars: | 2022-12-16 | by ( Dietrich Knauth | Industry Insight | Saw Law Firms Move Past The Pandemic Into A More Client-Focused Service Environment | ) www.reuters.com time to read: +2 min

Dec 16 (Reuters) - A group of media companies is set to argue on Friday to the U.S. judge overseeing the FTX bankruptcy that they should be allowed to request that the collapsed crypto exchange make public the names of its customers. In seeking to intervene in the case, the New York Times (NYT.N), Dow Jones, Bloomberg and the Financial Times said bankruptcy law demands transparency. Letting customer names remain secret could turn bankruptcy proceedings into a "farce" if creditors start fighting anonymously over how much money they should get, the media companies wrote in a Delaware bankruptcy court filing. U.S. Bankruptcy Judge John Dorsey said he will not rule on customer privacy issues before January. During Friday's hearing, FTX will also provide an update on its asset recovery efforts and its dispute with the Bahamas-based liquidators.

Dec 15 (Reuters) - The U.S. Department of Justice's bankruptcy watchdog on Thursday appointed a committee to represent FTX accountholders and other junior creditors in the collapsed crypto exchange's bankruptcy case. The nine-member committee includes three individual creditors, Genesis affiliate GGC International Ltd, crypto trader Wintermute Asia PTE, Coincident Capital International, Pulsar Global Ltd, Octopus Information Ltd and Wincent Investment Fund. Crypto firms that went bankrupt earlier this year, including Voyager Digital and Celsius Network, have classified most of their customers, particularly those with interest-bearing accounts, as unsecured creditors. U.S. Bankruptcy Judge John Dorsey, who is overseeing FTX's Chapter 11 case, said during a Wednesday court hearing that he expects the creditors' committee to weigh in on issues related to customer privacy at a hearing scheduled in early January. FTX has argued that customer names should be kept secret to protect them from scams and to preserve the business value of FTX's customer list for potential buyers.

THE FIRST TIME Racil Chalhoub, 39, a womenswear designer from Beirut, decided to buy men’s clothing, she was standing in a sea of denim at Abercrombie & Fitch in Los Angeles. This was the early aughts—when many women’s jeans were so snug and low-cut that visible thongs were considered a viable accessory. But Ms. Chalhoub craved loose, roomy hip-huggers. “Everything for women was fitted or flared,” she said. Ms. Chalhoub even launched her own women’s tuxedo brand, Racil, in 2015.

☆ AIG subsidiary files for Chapter 11 bankruptcy
▼ + stars: | 2022-12-14 | by ( ) www.reuters.com time to read: +2 min

Dec 14 (Reuters) - American International Group Inc said on Wednesday its subsidiary, AIG Financial Products (FP), had filed for Chapter 11 bankruptcy protection to complete the wind down of a business unit that was a central figure in the 2008 financial crisis. AIG Financial Products largely ceased operations in 2008, and its bankruptcy will not have a material impact on AIG or on life and retirement insurer Corebridge Financial Inc (CRBG.N), which AIG recently spun off, AIG said. AIG Financial Products issued the credit default swaps that put AIG on the hook for billions of dollars in losses during the collapse of subprime mortgage markets, according to court documents filed in U.S. Bankruptcy Court in Wilmington, Delaware. AIG Financial Products has no ongoing operations or employees of its own, but it maintained a small portfolio of financial products after largely shutting down in 2008. It owes more than $37 billion to its parent company AIG on loans related to the 2008 crash, according to court documents.

FTX attorney James Bromley told Dorsey that the Bahamian government has previously obtained information from FTX Digital Market's liquidators and used it to siphon digital assets away from FTX. The Securities Commission of the Bahamas (SCB) has previously disputed FTX's "misstatements" about the Bahamian government's response to FTX's collapse. Chris Shore, an attorney for the Bahamas-based liquidators, told Dorsey that the liquidators were not working at the direction of the Bahamian government. Dorsey began the hearing by asking whether FTX and the Bahamas liquidators could reach a compromise on data sharing before Bromley shot that suggestion down. "Unlike the Chapter 11 process, there is no transparency in the process in the Bahamas," Ray said.

In the first hearing of Jones' bankruptcy in a Houston court, his attorney Vickie Driver said Jones wanted to settle with the Sandy Hook families. They won $1.5 billion in defamation trials over Jones' lies about the 2012 school shooting. David Zensky, an attorney for the Sandy Hook families, said Jones lied for years about the Sandy Hook shooting and concealed information about his companies InfoWars and Free Speech Systems. InfoWars' parent company, Free Speech Systems, which is owned by Jones, filed for bankruptcy in July, before courts in Texas and Connecticut determined the amount of Jones' liability for the Sandy Hook defamation claims. Jones has said that he will appeal the Sandy Hook verdicts if he is unable to reach a settlement in bankruptcy.

Dec 7 (Reuters) - A U.S. bankruptcy judge on Wednesday ruled that some customers of crypto lender Celsius Network should receive their deposits back, giving relief to a relatively small group of customers whose deposits were never commingled with other Celsius funds. U.S. Bankruptcy Judge Martin Glenn is weighing broader questions of who owns crypto assets that were deposited with Celsius. Judge Glenn has not yet ruled on ownership of Celsius "earn" accounts or "withhold" accounts. Those regulatory investigations, which alleged that earn accounts were an unregistered securities offering, caused Celsius to create non-interest bearing custody accounts and withhold accounts. When it filed for Chapter 11 bankruptcy in July, Celsius reported $4.3 billion in assets and $5.5 billion in liabilities, primarily owed to its customers.

If Celsius deposits are determined to belong to customers, users are far more likely to get their assets returned. Crypto companies typically offer a variety of accounts and they will likely be treated differently in bankruptcy. BlockFi, which is at the beginning of its own bankruptcy case, also offers both interest-bearing and custody accounts. 'WORSE THAN BANKS'Courts will also have to look beyond the user agreements and examine how crypto companies actually handled the deposits, according to bankruptcy specialists. “This is going to have enormous influence on crypto companies and crypto customer behavior."

The loonie was trading 0.2% lower at 1.3455 to the greenback, or 74.32 U.S. cents, after trading in a range of 1.3421 to 1.3520. For the week, it was on track to decline 0.6%. Canada added 10,100 jobs in November, broadly in line with the forecast gain of 5,000, while the jobless rate fell to 5.1%, Statistics Canada said. The U.S. dollar rallied against a basket of major currencies and equity markets globally fell. Canadian government bond yields climbed across the curve, tracking the move in U.S. Treasuries.

☆ Three Arrows Capital says its founders still not cooperating with asset recovery
▼ + stars: | 2022-12-02 | by ( Dietrich Knauth | ) www.reuters.com time to read: +2 min

Dec 2 (Reuters) - Liquidators for bankrupt crypto hedge fund Three Arrows Capital (3AC) said on Friday that the company's founders are refusing to cooperate with asset recovery efforts, hindering the company's ability to return funds to creditors. Founders Kyle Davies and Su Zhu are more interested in rehabilitating their reputation than helping their own company's creditors, attorney Adam Goldberg said in bankruptcy court in New York. Davies has done interviews recently commenting on the implosion of crypto exchange FTX, attempting to shift blame for Three Arrows' own collapse, Goldberg said. Despite incomplete access to records and accounts, Three Arrows' liquidators have recovered some assets belonging to creditors, including $35 million in U.S. dollars and several different cryptocurrency tokens, liquidator Russell Crumpler said in court. They filed a parallel bankruptcy case in Manhattan to shield Three Arrows' U.S. assets.

☆ Factbox: Crypto companies crash into bankruptcy
▼ + stars: | 2022-12-01 | by ( Dietrich Knauth | ) www.reuters.com time to read: +5 min

The price of bitcoin has dropped 65% since the start of the year, the cryptocurrency Luna suffered a total collapse in value, and crypto exchange FTX went from buying Super Bowl ads to crash landing into bankruptcy. Here are the major crypto companies that have gone bankrupt in 2022. BLOCKFICrypto lender BlockFi was the first crypto company to follow FTX into bankruptcy, filing for Chapter 11 about two weeks after FTX's collapse. The proposed sale fell through following FTX's implosion, and Voyager reopened discussions with other potential buyers, including the crypto exchange Binance. Celsius' bankruptcy judge has appointed an examiner to investigate whether Celsius operated as a Ponzi scheme and to broadly review the company's finances.

☆ DOJ watchdog seeks independent review of FTX bankruptcy
▼ + stars: | 2022-12-01 | by ( Dietrich Knauth | ) www.reuters.com time to read: +2 min

Dec 1 (Reuters) - The U.S. Department of Justice's bankruptcy watchdog on Thursday called for an independent investigation into the collapse of crypto exchange FTX, saying customers need a neutral party to investigate allegations of "fraud, dishonesty, incompetence, misconduct, and mismanagement." "The questions at stake here are simply too large and tooimportant to be left to an internal investigation," U.S. Trustee Andrew Vara wrote in court papers. A neutral examiner would also provide more public and transparent findings than an internal review, the U.S. Trustee wrote, which is "especially important because of the wider implications that FTX’s collapse may have for the crypto industry," Vara added.

☆ BlockFi makes first appearance in bankruptcy court
▼ + stars: | 2022-11-29 | by ( Dietrich Knauth | ) www.reuters.com time to read: +3 min

Nov 29 (Reuters) - U.S. cryptocurrency lender BlockFi on Tuesday will make its first appearance in U.S. bankruptcy court after filing for Chapter 11 protection on Monday. BlockFi is expected to tell U.S. Bankruptcy Judge Michael Kaplan in Trenton, New Jersey why it went bankrupt and how it plans to exit from Chapter 11. New Jersey-based BlockFi became the first direct casualty of crypto exchange FTX's collapse earlier this month. The company sold a portion of its crypto assets earlier in November to fund its bankruptcy, and it entered bankruptcy with $256.5 million in cash on hand. BlockFi's Chapter 11 plan envisages that BlockFi Wallet customers would be paid back in full and other account holders and creditors would receive a mixture of cryptocurrency, cash, and new equity shares.

☆ BlockFi tells U.S. bankruptcy court it is 'the antithesis of FTX'
▼ + stars: | 2022-11-29 | by ( Dietrich Knauth | ) www.reuters.com time to read: +4 min

REUTERS/Dado Ruvic/IllustrationNov 29 (Reuters) - Lawyers for BlockFi, the first direct casualty of crypto exchange FTX's collapse, made their initial appearance in U.S. bankruptcy court on Tuesday, emphasizing that the U.S. cryptocurrency lender was "the antithesis of FTX." Sussberg went to great lengths to distance BlockFi from FTX, saying the company did not face the myriad issues apparently plaguing FTX. Sussberg said BlockFi also intends to seek a court ruling allowing customers in the BlockFi Wallet program to withdraw their funds during the bankruptcy case if they wish. "If it's in your wallet, it stays in your wallet," Sussberg said. Its Chapter 11 plan envisages that BlockFi Wallet customers would be paid back in full and other account holders and creditors would receive a mixture of cryptocurrency, cash, and new equity shares.

New Jersey-based BlockFi, founded by fintech executive-turned-crypto entrepreneur Zac Prince, said in a bankruptcy filing that its substantial exposure to FTX created a liquidity crisis. BlockFi listed its assets and liabilities as being between $1 billion and $10 billion. Renzi said that BlockFi had sold a portion of its crypto assets earlier in November to fund its bankruptcy. In a court filing on Monday, BlockFi listed FTX as its second-largest creditor, with $275 million owed on a loan extended earlier this year. In its bankruptcy filing, BlockFi said it had hired Kirkland & Ellis and Haynes & Boone as bankruptcy counsel.

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New Jersey-based BlockFi, founded by Zac Prince, said in a bankruptcy filing that its substantial exposure to FTX created a liquidity crisis. In a court filing on Monday, BlockFi listed FTX as its second-largest creditor, with $275 million owed on a loan extended earlier this year. Crypto lenders, the de facto banks of the crypto world, boomed during the pandemic, attracting retail customers with double-digit rates in return for their cryptocurrency deposits. Crypto lenders are not required to hold capital or liquidity buffers like traditional lenders and some found themselves exposed when a shortage of collateral forced them - and their customers - to shoulder large losses. In its bankruptcy filing, BlockFi said it had hired Kirkland & Ellis and Haynes & Boone as bankruptcy counsel and Berkeley Research Group as a financial adviser.

☆ Crypto lender BlockFi files for bankruptcy in New Jersey
▼ + stars: | 2022-11-28 | by ( ) www.reuters.com time to read: +1 min

Nov 28 (Reuters) - U.S. cryptocurrency lender BlockFi said on Monday it had filed for Chapter 11 bankruptcy protection along with eight affiliates in a New Jersey court, the latest casualty since FTX's collapse earlier this month triggered instability in the crypto market. It listed crypto exchange FTX as its second-largest creditor, with $275 million owed on a loan extended earlier this year. The company's largest creditor is Ankura Trust, a company that represents creditors in stressed situations, and is owed $729 million. BlockFi had earlier paused withdrawals from its platform and acknowledged it had "significant exposure" to FTX and its associated entities. The move comes weeks after FTX filed for U.S. bankruptcy protection and its founder Sam Bankman-Fried resigned as chief executive.

NEW YORK/LONDON, Nov 22 (Reuters) - FTX has a total cash balance of $1.24 billion, a court filing by advisers on the stricken crypto exchange's restructuring showed ahead of U.S. bankruptcy hearings set for later on Tuesday. Its cash balance as of Sunday was "substantially higher" than previously thought, Monday's filing by Edgar Mosley of Alvarez & Marshal, a consultancy firm advising FTX, said. The details of FTX's cash balances came ahead of a hearing in Delaware on FTX's so-called first-day motions. FTX, led since the bankruptcy filing by new CEO John Ray, has accused Bankman-Fried of working with Bahamian regulators to "undermine" the U.S. bankruptcy case and shift assets overseas. Since the implosion of FTX, some crypto players are taking to decentralized exchanges known as "DEXs" where investors trade peer-to-peer on the blockchain.

The following are major companies that were accused of contributing to the crisis, and settlements or judgments involving those companies. Teva Pharmaceutical Industries Ltd (TEVA.TA)-In November, finalized claims nationwide for $4.25 billion, some of which is to be paid as a supply of the overdose-reversing drug naloxone. AbbVie Inc (ABBV.N)-In November, finalized a $2.37 billion nationwide settlement resolving claims against Allergan, a company it acquired in 2020. Endo International Plc (ENDPQ.PK)-Reached a $450 million settlement with more than 30 states as part of a bankruptcy filing in August. Mallinckrodt Plc (MNK.A)-Reached a $1.7 billion nationwide settlement as part of its bankruptcy reorganization plan, approved in February.

Nov 16 (Reuters) - Crypto lender Genesis Global Capital suspended customer redemptions on Wednesday, citing the sudden failure of crypto exchange FTX, while court papers showed FTX founder Sam Bankman-Fried faces legal action. After a flurry of tweets and interviews by Bankman-Fried, FTX said he "has no ongoing role" at the company and does not speak on its behalf. LEGAL ACTIONMeanwhile, U.S. court filings showed Bankman-Fried is facing legal action in the United States from investors alleging the company's yield-bearing crypto accounts violated Florida law. U.S. and Bahamian authorities were discussing the possibility of bringing Bankman-Fried to the United States for questioning, Bloomberg reported on Tuesday. Elsewhere, crypto exchange Binance said it had not contributed to FTX's collapse, in a response to a hearing on the crypto industry by a British parliamentary committee.

Nov 16 (Reuters) - Crypto lender Genesis Global Capital suspended redemptions on Wednesday citing the failure of crypto exchange FTX, while court papers showed FTX founder Sam Bankman-Fried faces legal action, as its sudden collapse ripples across the industry. LEGAL ACTIONMeanwhile, U.S. court filings showed Bankman-Fried is facing legal action in the United States from investors alleging the company's yield-bearing crypto accounts violated Florida law. Bloomberg on Tuesday also reported that U.S. and Bahamian authorities were discussing the possibility of bringing Bankman-Fried to the United States for questioning. Elsewhere, crypto exchange Binance, in a response to a hearing on the crypto industry by a British parliamentary committee on Monday, said it had not contributed to FTX's collapse. The U.S. House Financial Services Committee said Wednesday it plans to hold a hearing in December to investigate the collapse of cryptocurrency exchange FTX.

☆ Explainer: What's next in FTX's bankruptcy
▼ + stars: | 2022-11-16 | by ( Dietrich Knauth | ) www.reuters.com time to read: +4 min

Here is what likely awaits in the case:WHERE DO THINGS STAND IN FTX'S BANKRUPTCY CASE? About 130 FTX affiliates have filed for bankruptcy in Delaware, and the company has selected a new CEO, bankruptcy attorneys at Sullivan & Cromwell and financial advisers at Alvarez & Marsal. WHAT OTHER RISKS DO FTX CUSTOMERS FACE? The bankruptcy might result in the publication of FTX customers' names, email addresses and transaction history. The courts' preference for transparency are at odds with crypto customers' expectations of anonymity.

☆ FTX's Bahamas liquidators "reject the validity" of US bankruptcy
▼ + stars: | 2022-11-16 | by ( Dietrich Knauth | ) www.reuters.com time to read: 1 min

Nov 16 (Reuters) - FTX's Bahamas-based liquidators said they "reject the validity" of the crypto exchange's U.S. bankruptcy proceedings, according to court documents filed in the U.S. late Tuesday. FTX and 130 affiliates filed for bankruptcy in the U.S. on Nov. 11, leaving an estimated 1 million customers and other investors facing total losses in the billions of dollars. But its Bahamas subsidiary FTX Digital Markets entered liquidation proceedings first, and its court-appointed liquidators said late Tuesday that their case may "impact" FTX's effort to reorganize in the U.S. Reporting by Dietrich KnauthOur Standards: The Thomson Reuters Trust Principles.

Nov 15 (Reuters) - FTX Trading's new CEO John J. Ray III, a lawyer tapped to lead the collapsed crypto exchange's restructuring, previously oversaw the $23 billion bankruptcy of energy firm Enron Corp and has a reputation for boosting creditor recoveries. Ray, 63, on Monday declined to comment on his initial priorities as FTX's CEO. Serving as Enron's CEO throughout its years-long bankruptcy, Ray's work resulted in major settlements with banks accused of helping Enron deceive investors, including a $1.66 billion settlement with Citigroup in 2008. Mark Lichtenstein, an attorney who worked on Enron's bankruptcy, saw many parallels between FTX and that case. "You’ve got such a meltdown, similar to Enron, sort of a run on the bank," Lichtenstein said.

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