bankruptcy

BlockFi lawyer tells court priority is to ‘maximize client recoveries’

In this photo illustration, the BlockFi logo seen displayed on a smartphone.

Rafael Henrique | Sopa Images | Lightrocket | Getty Images

BlockFi plans to reopen withdrawals as part of an effort to “maximize client recoveries,” the crypto lender’s lawyers said at a court hearing Tuesday, a day after the firm filed for Chapter 11 bankruptcy protection.

BlockFi’s lawyers at that hearing expressed optimism that the firm is in good position to restructure and salvage the business through the bankruptcy process.

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“We want to make sure we get people back as much of their value as quick as we can,” said Josh Sussberg, a partner at BlockFi’s legal firm Kirkland & Ellis.

BlockFi’s collapse was precipitated by exposure to Three Arrows Capital — which filed for bankruptcy protection in July — and to Alameda Research, the FTX trading arm that borrowed hundreds of millions of dollars from BlockFi. FTX had arranged a rescue plan for BlockFi, but that fell apart when FTX faced its own liquidity crisis earlier this month and rapidly sank into bankruptcy.

BlockFi loaned $671 million

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FTX Is Allowed to Hide the Identity of Its 50 Biggest Creditors

(Bloomberg) — FTX creditors, including rich investors who don’t want their names made public, can remain anonymous and still participate in the company’s bankruptcy case for now, a judge ruled at the company’s first court hearing Tuesday. 

US Bankruptcy Judge John Dorsey agreed to let the fallen crypto exchange redact the names of the 50 biggest unsecured creditors owed a total of $3.1 billion. The US Bankruptcy Code normally requires the names be filed in documents available to the public. Representatives for FTX argued those creditors are also customers and disclosure would allow rivals to steal their business. 

The sudden fall of Sam Bankman-Fried’s crypto empire into bankruptcy Nov. 11 was so fast, and so disorganized that many standard procedures, including Tuesday’s hearing, have been subject to delays. The hearing began with FTX attorney James Bromley saying a “substantial amount” of the group’s assets “have either been stolen or are missing.” 

At least two groups of crypto creditors sent lawyers to the hearing to support the company’s request to keep their identities secret. One included members that are among FTX’s largest unsecured creditors — likely setting the stage for future fights for assets among various groups.

Dorsey agreed to

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Courtroom Experience in Bankruptcy Clinic Affords Foreign Lawyer Invaluable Know-How

The Eleanor R. Cristol and Judge A. Jay Cristol Bankruptcy Pro Bono Assistance Clinic at Miami Law offers pro bono legal services to low-income individuals who are dealing with bankruptcy.




The Bankruptcy Clinic, directed by bankruptcy expert Patricia Redmond, gives the opportunity for students with an interest in business law and litigation to gain hands-on experience representing clients.

LL.M. to J.D. student, Ana Paula Carrijo Barroso from Brazil, successfully argued a Motion to Reinstate client’s bankruptcy case in Bankruptcy Court. Working under the supervision of local attorney Jeffrey Bast, who serves as a clinic mentor, she represented the client in a Chapter 7 Bankruptcy.

Lawyering Skills in Action

The Brazilian attorney chose the Bankruptcy Clinic with a purpose.

“I decided to apply for the Bankruptcy Clinic because I wanted to challenge myself. I had never studied nor worked with bankruptcy before. I was also looking forward to improving my writing and oral skills, and I had heard about the excellent preparing offered by the Bankruptcy Clinic,” says Carrijo Barroso.

For this case, she dove in and worked “hands-on from day one.” She not only drafted the Motion to Reinstate the Case and prepared the schedules in a 3-hours in-person

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Auto suppliers turn to bankruptcy to renegotiate contracts

Suppliers have so far been largely successful in obtaining pricing relief from automakers, according to attorneys and consultants involved in the discussions. But as suppliers intensify their efforts for price increases, and OEMs face a bleaker economic outlook and major supplier-related financial losses, it’s less of a guarantee who blinks first at the negotiation table.

The situation is not nearly as dire as the Great Recession of 2007-09, but suppliers across the tiers continue bearing the brunt of supply chain pain, and they are not afraid of pulling the bankruptcy card, according to Max Newman, attorney at Detroit-based Butzel Long who specializes in Chapter 11 proceedings.

“There have been threats of bankruptcy in connection with price increases, and there’s sort of an implicit threat of bankruptcy whenever a supplier is seeking a price increase because an OEM doesn’t just hand them out to anybody,” Newman said.

In the past few months, at least five automotive suppliers have filed for bankruptcy while others have moved to close plants in Michigan as supply chain volatility and inflation bloat the cost of doing business.

In many instances, suppliers are locked into contracts entered before the COVID-19 pandemic and supply crisis flipped the

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