McDermott Will & Emery, the law firm representing Voyager’s committee of unsecured creditors, has invoiced the group $5.1 million, in a filing, for services rendered between March and May. The group has now been charged a total of $16.4 million in compensation, more than the $11.2 million anticipated as part of its restructuring process. Of this billed compensation, the creditors have already granted $8.9 million.
Voyager attorney fees are mounting
McDermott Will & Emery has filed a document showing the amount the bankrupt lender owes. For the fee period, the attorneys billed $1 million for 970.9 hours of work on a plan and disclosure settlement, one of the top billing categories. The category comprises debating the debtors’ selling options, meeting prospective purchasers, and assessing any objections put out by other parties.
Significant work in this category was done in previous fee periods on a potential sale of the company’s assets to FTX, a plan that fell through when the exchange filed for bankruptcy.
The new bills are adding up in the legal fees the creditors owe. Kirkland & Ellis’ law firm recently billed the lender $1.1 million for providing legal services in April in the bankruptcy case for the cryptocurrency lender. For their work on the case, some of the highest-paid partners at the company are billing upwards of $2,000 per hour, with some billing hundreds of thousands of dollars each month.
One of Kirkland & Ellis’ litigation lawyers, George W. Hicks Jr., P.C., charged $153,211 in fees over 87.8 hours of labor, and an associate, Nicholas Adzima, charged 118 hours for a total of $147,906 in pay for the month.
Voyager working to recover funds for users
Voyager filed for bankruptcy in July last year after the crypto market slumped in May and suspended its trading, withdrawals, deposits, and loyalty awards. Since then, the company has been working diligently on a plan to recover funds for its investors.
In September 2022, the company and FTX negotiated an agreement for the exchange to buy its distressed assets. However, the deal was scrapped after FTX filed for bankruptcy, and its founder, Sam Bankman-Fried, was accused of numerous financial offenses.
The lender later declared that Binance.US had made the biggest and best offer for its troubled assets in December 2022. The deal’s estimated worth was $1.022 billion, but is yet to fall through considering that Binance has its own fair share of legal issues it is currently looking to solve.
Meanwhile, hopes for the recovery of the clients’ funds are heavily reliant on the outcome of the legal dispute with FTX, whereby the lender is attempting to recoup $445.8 million in loan repayments made to Voyager before FTX’s bankruptcy. Per Voyager’s court documents, customers’ anticipated reimbursement would increase to 63.74% if Voyager completely wins the FTX litigation.
Among other firms facing heft legal fees are FTX and Celsius with $200 million and $50 million in fees respectively. While the wave of bankruptcies caused by the 2022 bear market resulted in a bull market for legal firms, these expensive fees and protracted legal proceedings leave less money for creditors in the long run.
