Edit: see Cate Hallâs comment for a better summary of the position under US law, and Mollyâs comment re further information OP intends to share from its external counsel shortly.
Epistemic status: I am not a lawyer in either the United States, or in Antigua and Barbuda (where FTX Trading Ltd was registered). Iâm also not an insolvency expert. Take all this with a grain of salt. This comment is not legal advice.
There are lots of things that might make answering this question in theory tricky, including identifying:
which FTX entity paid your grant;
which jurisdictionâs insolvency law applies;
whether that FTX entity was insolvent at the time it paid you;
whether the relevant insolvency law allows for clawing back payments made prior to filing for bankruptcy/âliquidation/âetc.
There are also practical questionsâif there is a multibillion dollar hole arising from illegitimate payments from FTX entities to Alameda, then would the liquidator/âUS trustee (etc) bother coming after small amounts (e.g. a $25,000 grant)? This isnât me suggesting that they wouldnâtâI genuinely do not know.
It looks as though the law in Antigua and Barbuda differs quite a bit from the United States law. This article suggests that Antigua and Barbuda law is that losses lie where they fall once the music stops.
I received a grant in March 2022, and I donât feel especially worried right now. Even if it turns out that some FTX entities were insolvent then, my rough sense is that either Antigua and Barbuda law applies and losses lie where they fall or that if US law applies then the transfer wonât be considered a preferential transfer subject to clawback because it occurred more than 90 days before any filing for bankruptcy. (I donât know if I am understanding the 90 day rule correctly, so please seek advice or look for yourself before making any decisionsâthis comment isnât legal advice.)
If I had received a grant more recently, then I would feel less confident. I might avoid spending the grant until learning more.
If any insolvency lawyers read this, consider commenting (even if not under your actual name) - or PM me to suggest any corrections/âclarifications.
As I commented to Cate, I would also think about whether any transfer could fall under 11 USC 548(a)(1)(B) which does not require actual intent to defraud creditors for something to be a âfraudulent transfer.â That is not an opinion on whether there are fraudulent transfers here, which (although a lawyer) I am not qualified to give.
This looks like the position under Bahamian law (which might be the relevant law, not Antigua and Barbuda law or US law, given FTX was operating in the BahamasâI just donât know how this actually works).
Edit: see Cate Hallâs comment for a better summary of the position under US law, and Mollyâs comment re further information OP intends to share from its external counsel shortly.
Epistemic status: I am not a lawyer in either the United States, or in Antigua and Barbuda (where FTX Trading Ltd was registered). Iâm also not an insolvency expert. Take all this with a grain of salt. This comment is not legal advice.
There are lots of things that might make answering this question in theory tricky, including identifying:
which FTX entity paid your grant;
which jurisdictionâs insolvency law applies;
whether that FTX entity was insolvent at the time it paid you;
whether the relevant insolvency law allows for clawing back payments made prior to filing for bankruptcy/âliquidation/âetc.
There are also practical questionsâif there is a multibillion dollar hole arising from illegitimate payments from FTX entities to Alameda, then would the liquidator/âUS trustee (etc) bother coming after small amounts (e.g. a $25,000 grant)? This isnât me suggesting that they wouldnâtâI genuinely do not know.
It looks as though the law in Antigua and Barbuda differs quite a bit from the United States law. This article suggests that Antigua and Barbuda law is that losses lie where they fall once the music stops.
I received a grant in March 2022, and I donât feel especially worried right now. Even if it turns out that some FTX entities were insolvent then, my rough sense is that either Antigua and Barbuda law applies and losses lie where they fall or that if US law applies then the transfer wonât be considered a preferential transfer subject to clawback because it occurred more than 90 days before any filing for bankruptcy. (I donât know if I am understanding the 90 day rule correctly, so please seek advice or look for yourself before making any decisionsâthis comment isnât legal advice.)
If I had received a grant more recently, then I would feel less confident. I might avoid spending the grant until learning more.
If any insolvency lawyers read this, consider commenting (even if not under your actual name) - or PM me to suggest any corrections/âclarifications.
As I commented to Cate, I would also think about whether any transfer could fall under 11 USC 548(a)(1)(B) which does not require actual intent to defraud creditors for something to be a âfraudulent transfer.â That is not an opinion on whether there are fraudulent transfers here, which (although a lawyer) I am not qualified to give.
Where are you getting 90 days from? I found six months, although this was very quick and I could easily have missed something.
This looks like the position under Bahamian law (which might be the relevant law, not Antigua and Barbuda law or US law, given FTX was operating in the BahamasâI just donât know how this actually works).
Re the 90 day rule in the United States, see here under the heading âAvoidable Transfersâ: https://ââwww.uscourts.gov/ââservices-forms/ââbankruptcy/ââbankruptcy-basics/ââchapter-11-bankruptcy-basics
Just to reiterate, Iâm not a US, Antigua+Barbuda or Bahamas lawyer, and this isnât legal advice.
See the first bullet point in this comment
thatâs pointing to US law, yes?
Yes, as was the part of Tyrone-Jay Barughâs comment referencing the 90 day rule.