No particular opinion. I don’t think it’s so disqualifying that it should stop you from seeking legal advice (twice to be sure, if you don’t like the first advice), and I don’t know what I would say here that you should weigh over that advice.
My layman’s guess is that there is a more-than-colorable argument that Alameda-of-2022 intrinsically valued the work of the grantees that it chose to grant to (including via the FTX Foundation), and so Organization B provided value by being able to work on its goals. The fact, then, that Alameda-of-2024 no longer values the same things (in no small part because it is run by different management) doesn’t enter into it.
But more generally, the main thing that I—as a non-lawyer—have learned in my interactions with the bankruptcy process is that most things come down to the spirit of the law as interpreted by one judge in Delaware. Even things that don’t reach a litigation tend to resolve along the lines of what the parties think that judge would rule after thinking about it for about an hour. It is not obvious to me that that hypothetical judge would rule that the spirit of the law is better-fulfilled by a grantee remitting funds that will ultimately go to government fines (according to the plan), and so it doesn’t feel like Sullcrom’s position is overwhelmingly strong here. “Come on, this feels borderline and a bit silly; let them keep it” can be a surprisingly valid position in the process as it actually happens, and I wouldn’t assume defeat based on my own attempt to steelman the opposing position based just on the text.
The second thing that I have learned is that the estate’s counsel and de facto management has broad discretion over what to pursue and what settlements to strike, and that while their goals may be furthered by the opportunity to do work that increases the number of legitimate billable hours, it’s a material risk to them to be billing hours that will later appear to be illegitimate. While maximizing total recoveries is supposed to be their paramount concern, it is perhaps the case that billing and the perception of legitimacy occasionally enter into their decisions, and that it would be consistent with those concerns to try sending pointed letters to former recipients of funds, accept voluntary returns, and not follow up vigorously against the small-to-medium (up to a few $mm) recipients that have more-solid cases and appear prepared to fight for their rights.
We agree that this is a point that the reader should discuss with their counsel, based on the specifics of their case.
No particular opinion. I don’t think it’s so disqualifying that it should stop you from seeking legal advice (twice to be sure, if you don’t like the first advice), and I don’t know what I would say here that you should weigh over that advice.
My layman’s guess is that there is a more-than-colorable argument that Alameda-of-2022 intrinsically valued the work of the grantees that it chose to grant to (including via the FTX Foundation), and so Organization B provided value by being able to work on its goals. The fact, then, that Alameda-of-2024 no longer values the same things (in no small part because it is run by different management) doesn’t enter into it.
But more generally, the main thing that I—as a non-lawyer—have learned in my interactions with the bankruptcy process is that most things come down to the spirit of the law as interpreted by one judge in Delaware. Even things that don’t reach a litigation tend to resolve along the lines of what the parties think that judge would rule after thinking about it for about an hour. It is not obvious to me that that hypothetical judge would rule that the spirit of the law is better-fulfilled by a grantee remitting funds that will ultimately go to government fines (according to the plan), and so it doesn’t feel like Sullcrom’s position is overwhelmingly strong here. “Come on, this feels borderline and a bit silly; let them keep it” can be a surprisingly valid position in the process as it actually happens, and I wouldn’t assume defeat based on my own attempt to steelman the opposing position based just on the text.
The second thing that I have learned is that the estate’s counsel and de facto management has broad discretion over what to pursue and what settlements to strike, and that while their goals may be furthered by the opportunity to do work that increases the number of legitimate billable hours, it’s a material risk to them to be billing hours that will later appear to be illegitimate. While maximizing total recoveries is supposed to be their paramount concern, it is perhaps the case that billing and the perception of legitimacy occasionally enter into their decisions, and that it would be consistent with those concerns to try sending pointed letters to former recipients of funds, accept voluntary returns, and not follow up vigorously against the small-to-medium (up to a few $mm) recipients that have more-solid cases and appear prepared to fight for their rights.
We agree that this is a point that the reader should discuss with their counsel, based on the specifics of their case.