American court hearing recordings and interviews - Season 1. Episode 8. February 15, 2023. In re FTX Trading Ltd., et al., chapter 11 bankruptcy case no. 22-11068, audio of the hearing held in the FTX/Alameda et al. bankruptcy proceedings pending in Delaware, USA #crypto

Episode Date: March 10, 2023

Following the trial in episode 7, in this episode the court hands down its ruling with respect to appointment of an independent examiner to conduct an investigation.The court also assesses a different matter after handing down the ruling, The court indicates interest in appointing a narrower scope professional called a "fee examiner" to review fee applications before certain of the professional firms working for the FTX/Alameda bankruptcy estate (for example some law firms, accountants, etc.). can have their fee applications for work on the FTX/Alameda case court approved and paid.

Yes, every gentleman. It's just signed vote. Good morning, Your Honor, and may it please the court. Adam Landis, for the record, from Landis Rath and Cobb, on behalf of F.TX Trading Limited and its affiliated debtors. Your Honor, we're here today with two agendas. I don't know the Latin for that as Agendum, but we're here with two agendas. One in the F.TX Trading Limited case and one in the F.TX Digital Markets case,

markets case. Nothing is contested, Your Honor, on either agenda. With respect to the FTX trading agenda, and we've spoken with counsel to the joint providential liquidators, we thought we would go forward with the FTX Trading Chapter 11 agenda first. We filed a second amended agenda last night, noting that the committee had filed certifications of counsel with respect to the professional retentions that had been contested by the U.S. trustee. I note that I think as we were standing here this morning, Your Honor, has signed the orders for FTI and Jeffries. So they really may, unless Your Honor has questions,

with respect to anything on the agenda, we believe we can move right to item number six, which is the court's ruling with respect to the United States trustees' motion to appoint an examiner. Okay. I don't have any questions. So we can go ahead. All right, so this is the ruling on the motion to appoint an examiner. The United States trustee moved for the appointment of an examiner in these cases,

pursuant to Section 1104C1 and C2, the bankruptcy could. You've finally broken loose from work. Three friends, one tea time, and then the text. Honey, there's water in the basement. Not exactly how you pictured your Saturday. That's when you call us. Cincinnati Insurance. We always answer the call because real protection means showing up, even when things are in the rough. Cincinnati Insurance. Let us make your bad day better. Find an agent at CINFIN.com.

Section 114 provides that if a Chapter 11 trustee is not appointed in a case on request of a party in interest or the United States trustee. And after notice in a hearing, the court shall appoint an examiner to conduct such an investigation of the debtor as is a appropriate, including an investigation of allegations of fraud, dishonesty, incompetence, misconduct, mismanagement, or irregularity in the management of the debtor, if one, such appointment is in the interest of the creditors and any equity security holders and interests and other interests of the estate, or two, the debtor's fixed, liquidated unsecured debts other than debts for goods, services, or taxes, or owing to an insider exceed $5 million. dollars. The trustee, joined by several state regulatory authorities, argues that because

there are allegations of massive fraud alleged against the debtors pre-petition management, the appointment of an examiner is in the best interest of the debtors, creditors, and other interest holders under 1104C1. The trustee also argues that even if I conclude the requirements of 1104C1 have not been met, I am required to appoint an examiner under 1104C2 because three of the debtors meet the debt threshold or the debtors do not for the purpose of this motion contest the debt limit with regard to the remaining debtors.

The debtors, the committee of general unsecured creditors and the joint provisional liquidators of FTX Digital Markets Limited appointed in the provisional liquidation proceeding pending in the Bahamas object to the appointment of an examiner arguing that given the investigations being conducted by the debtors and the committee

as well as various federal law enforcement and regulatory agencies, there is no need to appoint an examiner to conduct yet another costly investigation that would slow the progress of these cases. Moreover, the objectors argue that contrary to the trustee's position, appointment of an examiner is not mandatory under 1104C2, even if the debt threshold is met. For the reasons I will explain, I agree with the objectors and will deny the motion to appoint an examiner. These cases have been described as unique, unusual, highly complex, and unprecedented, and just a few of the adjectives applied to them, and they have certainly lived up to that billing.

A multi-billion dollar company built over the course of just a few years, a spectacular crash with billions worth of assets missing, allegations of gross mismanagement and massive fraud, leading to criminal indictments and investigations by numerous federal agents. by numerous federal agencies. Behind that backdrop sit the creditors and the customers of the debtors. Individuals and entities that trusted the management of the company with their relatively new type of asset,

cryptocurrency, as well as those who did business with the debtors on a day-to-day basis. This case is about making sure that those parties get back as much value as possible from the debtors' estates. That process began immediately prior to the filing of these cases with the appointment of Mr. Ray as the new CEO of the debtors of the debtors. debtors. Although appointed by the previous CEO, Mr. Bangman-Fried, who is currently under federal

indictment, there's no question that Mr. Ray is completely independent of prior management and the companies he was appointed to lead. Mr. Ray is the consummate professional, highly qualified with decades of experience and taking control of companies in dire financial condition. Mr. Ray in turn appointed four independent directors to three silos of debtor entities to assist him in determining what happened, how to sort out the financial condition of the debtors, and return as much value as possible to creditors and customers. Each of the four directors are also highly qualified professionals with no prior connection with the debtors or the debtors prior management.

Mr. Ray also ensured that all prior senior management of the debtors were removed, two of whom have been indicted and pled guilty to various crimes involving the management of the debtors. Although some prior officers of the debtors remain in place, there's no indication that. they were involved in any wrongdoing, and according to Mr. Ray, all had been stripped of any decision-making authority. Mr. Ray has also retained a group of highly qualified experts to assist with sorting through the debtor's poorly maintained records. In many instances, records don't exist at all because the record keeping was neglected by prior management. Mr. Ray testified that those experts, among other things, are accessing the debtors extremely vulnerable,

electronic information containing crypto assets that have already suffered hacking incidents, both pre-and-posted petition, before controls could be restored. Those hacks resulted in the possible loss of hundreds of millions, if not billions of dollars worth of crypto assets. He further testified that he's been informed by those experts that giving additional persons access to the data creates the risk of further inadvertent disclosure or hacking of information that could lead to additional losses.

Indeed, even committee counsel indicated that while they are working closely with the debtors in conducting investigations into what happened, the committee is not requesting direct access to the debtor's data, due to those risks. There's no question that an examiner or a Chapter 11 trustee, for that matter, appointed pursuant to Section 1104, would have the same attributes as Mr. Ray and the independent directors.

That person would be independent with no connection to the debtors or the debtor's prior management. That person would need to be qualified and as experienced as Mr. Ray, and that person would retain qualified and experienced professionals to assist with the investigation. There's no question that if an examiner was appointed here, the cost of the examination, given the scope suggested by the trustee at the hearing, would be in the tens of millions of dollars and would likely exceed $100 million. Contrary to the suggestion of the trustee, the debtors in the committee could not merely sit idly by, while a month-long investigation unfolded, leading to exponential cost to the estate,

which would have to be borne by the creditors. While the debtors may ultimately have billions of dollars' worth of assets to distribute, creditors will likely not come close to recovering the full amount of their losses, and it may take some time to recover anything as the debtors in the committee work to claw back as much of the assets as possible. Given the facts and circumstances of this highly unique case, I have no doubt that the appointment of an examiner would not be in the best interest of the creditors. There are already multiple investigations underway by incredibly competent and independent parties. Requiring creditors to bear the burden of yet another investigation does not comport with the requirements of Section 1104 C1, or the general scheme of the bankruptcy code, that is to maximize recovery to creditors. It is important to keep in mind that while we talk about the cost of an investigation being borne by the debtors,

we are actually talking about the cost being borne by the creditors. Every dollar spent in these cases on administrative expenses is a dollar less to the creditors. Therefore, I will deny the request to appoint an examiner under 1104C1. I should have brought some water with me. The trustee argues, however, that even if I conclude that the appointment of an examiner is not in the best interest of the creditors, I am still obligated to appoint one as mandated by Section 1104C2 because the debtors met the burden, met the debt threshold, or at least do not contest that they do for purposes of this motion. Even the trustee concedes, however, that a bankruptcy court has some discretion in determining whether or not an examiner must be appointed under 1104C2,

for example, or a motion to appoint an examiner is being used by a creditor to obtain an advantage in plan negotiations. In other words, the trustee agrees there are times when the appointment of an examiner would not be appropriate under 1104C2. To be sure, there is a split of authority over whether 1104C2 leaves any discretion on the appointment of an examiner. The courts that hold there is no discretion concentrate on the language in 1104 that states, quote, the court shall appoint an examiner with emphasis on shall. if the debtor meets the debt requirements of Section C2. Those courts either ignore the additional language of 1104 that states, quote, to conduct section investigation of the debtors as is appropriate, close quote,

or conclude that the language only means the court can direct the scope and nature of an examination after an examiner is appointed. For example, see Inray Revco, 898 F-second, 498 at 501, 6th Circuit 1990. Court held appointment is mandatory, but, quote, the bankruptcy court retains broad discretion to direct the examiner's investigation, including its nature, extent, and duration, close quote. The Sixth Circuit is the only circuit court of appeals to consider the issue. Other courts have concluded that the as-appropriate language in 1104C permits a bankruptcy court to deny the appointment of an examiner in limited circumstances, even if the debtor meets the debt requirements of C-2.

In examples are Inray Residential Capital LLC 474, Bankruptcy Reporter 112, 117, Bankruptcy, SDNY 2012, InRe Duy and Lemouf, 478, BR 627, 629, bankruptcy, SDNY 2012, Inray Shelter Resources, 35 BR 304, thank you very much. 304, 305, bankruptcy in Northern District of Ohio, 1983, Inray Gilman, services, 46 BR 322, 327, bankruptcy district of Massachusetts, 1985, Inray-Earxon Retirement Communities LLC, 425 BR 309, NAP 312, Bankruptcy, Northern District of Texas, 2010, in-ray GHR-GHR Companies Inc, 43, BR-165-170, bankruptcy District of Massachusetts, 1984. Indeed, every bankruptcy judge in this district to consider the issue has concluded that there is

discretion. See Inray S.A. Telecom Inc. case number 97-2395-2401. Judge Walsh, March 27th, 1998. Hearing transcript at 82. In-ray Spansion, 426, BR 11418, Bankruptcy Court District of Delaware 2010, Judge Shannon decision. In-R. Vistion Corporation, number 09-11786. Judge Sanchi decision from May, 12 2010 hearing transcript at 170 in re Washington Mutual Inc no case number 0 8 1 2229 a judge walrath decision bankruptcy district of Delaware May 5 2010 hearing transcript at 97 and two of my own prior cases in Ray Cred Inc case number 20 dash 1 2836 bankruptcy district of Delaware December 20 December 12 2020 hearing

transcript at 95 and in Ray Malancroat PLC case case number 20-12522 in November 22, 2021, hearing transcript 38 through 46. As Judge Glenn posited the question in residential capital, quote, if the as-as-appropriate language provides such discretion with respect to the nature, extent, and duration of the investigation, then why doesn't the same language provide discretion to just say no to an examiner investigation where it may not be justified on the particular facts and circumstances of the case. 474 BR at 118. As the trustee pointed out during argument, ultimately Judge Glenn did appoint an examiner in residential capital because one no plan had been confirmed. Two, no trustee had been

appointed. Three, the debtor had fixed debts exceeding $5 million. And four, an investigation was appropriate and an investigation by the committee had just begun. The first three elements of this analysis are certainly present here. But while one could argue, the fourth is also met because the debtors in the committee are in the early stages of their investigations. The facts present here are fundamentally different than a residential capital. First, Judge Glenn recognized in residential capital that, quote, other than the committee, there is currently no independent party with the ability and authority to fully investigate and analyze the transactions at issue. Judge Glenn emphasized the no independent party in that state.

By contrast, in this case, all of the senior managers of the company accused of wrongdoing have been removed replaced by extremely competent, independent professionals led by Mr. Ray with the ability and authority to investigate all claims that might ultimately benefit to creditors in these cases. Moreover, as indicated before, all remaining employees and officers of the debtors, all remaining employees and officers to the debtors that have not been accused of wrongdoing, have been, do not possess any decision-making authority. Mr. Ray has also retained professionals that are fully capable of conducting an thorough investigation. Second, as Judge Glenn recognized, an examiner investigation might not be appropriate when, among other things, the debtor's senior management has been indicted. 474 BR at 118, footnote 6.

Here, of course, senior management has been indicted. Two, have pled guilty, and three, and a third is scheduled for trial in October. Finally, the issues to be investigated in residential capital involve a, quote, complex constellation of pre- and post-bankruptcy transactions involving billions of dollars in transfers and financing among interested parties, via that 115 note 3, emphasis on interested parties. In residential capital, the allegations were that transfers between the debtors and certain secured creditors benefited the secured creditors to the detriment of unsecured creditors. Here, there are no secured creditors.

There are only unsecured creditors. Finally, the issues to be investigated in residential capital, no, excuse me. Moreover, while the transfers at issue in residential capital were clearly complicated, commercial transactions. There was no indication that accessing the debtor's financial information would create a risk of further harm to the debtors or their creditors. By contrast, the uncontroverted testimony during the hearing in this matter established that given the debtor's business and the vulnerability of the debtor's financial data, permitting additional parties' access to the financial information would create an increased risk of further loss through

inadvertent disclosures or hacking. Therefore, I conclude that under the facts and circumstances of these cases, appointment of an examiner is not needed pursuant to 1104 C2, and appointing one would impose an unnecessary burden on the debtors and ultimately the creditors for whose benefit these cases are being pursued. Contrary to the trustee's position, this is not inconsistent with the language of the statute or the legislative history. Congress did not explain in the language of the statute itself what it meant by the as-as-as-appropriate limitation.

As I previously mentioned, many courts have concluded that it means a bankruptcy court must always appoint an examiner if the debt limit has been made. but can limit the nature extent and duration of any examination. Others have concluded that if the bankruptcy court can limit the scope and duration, it must also mean that the court can conclude that no examination is needed at all under specific facts and circumstances. Clearly, there is more than one logical conclusion as to the meaning of Section 1104C. The legislative history of 1104C, which at the time of its enactment was 1104B,

concluded that, quote, the standards for the appointment of an examiner are the same as those for the appointment of trustee, the protection must be needed, and the cost and expense must not be disproportionately high. HR rep number 95-595-95th Congress First Section 402, 1977. Thus, the legislative history supports the conclusion that an examiner shall be appointed, quote, as appropriate under the particular circumstances of the case, but, quote, the protection must be needed. That legislative intent is met in cases where, even though the debt limit of 11044, C2 has met the evidence establishes an examiner is not needed under the facts and

circumstances of a particular case therefore I'll sustain the objections and deny the motion to appoint an examiner the parties should meet and confer and submit a form of order under certification of counsel any questions thank you your honor I just wanted to go back very briefly to the second amended agenda there's an item five that was the committee's motion for permission to to file a response to the United States trustee's objection. I believe that matter is mooted out and the committee is not pressing it but I didn't, for housekeeping purposes, want to

just let that hang out on the agenda. So he's probably here from the committee on that. Does he move. Yeah, I believe it's just the motion for simply procedural. I don't believe you have a trustee had an objection to it so housekeeping you can upload it with form of order is acceptable. All right, we'll go ahead and just enter the word. Thank you. I just wanted to make sure that that loose end is tied up. And with that, we can pass the podium over to counsel to the joint provisional liquidators.

All right. Your Honor, Chris Shore from Whiten case on behalf of the joint provisional liquidators in the Chapter 15 case now. We're here today seeking recognition of the pending Bohemian liquidation as a foreign main proceeding and granting related relief. attending in the courtroom today are Brian Sims and Peter Greaves, two of the JPLs. The third, Kevin Cambridge, unfortunately, was unavailable to come today because he's ill COVID. As for today's agenda, we're happy to report that there are no pending objections to our request for recognition. So if it's okay with the court, I'd like to proceed as follows. First, I'd like to move in the evidence into the record and request that the court enter the proposed form of order, which

we filed on Monday at Docket 125. Then I'd like to give the court a 15-minute status update, not in the way of evidence, but just to give your honor a sense of what the JPLs have been doing and give you kind of a six-month look forward. So you know what's going to be happening in the case. And good news is I don't perceive that we're going to be doing a lot in the 15 over that time.

But maybe at the end, how we can set a further status conference, just to let you know. what's happening in that proceeding. And, of course, at any time, if Your Honor has questions, I'm happy to answer them or have others assist in the answer. As for the evidence, the verified petition is filed at docket number one of the Chapter 15. We have three declarations that we'd like to submit into evidence in support of the application. Those are the two declarations of Mr. Sims and the declaration of Sophia Roll Cap

in support of the petition at dockets 25 and 8. Mr. Sims is here, should you have any questions for him. Ms. Role-Cap had to be in the Bahamas yesterday at the recognition of the debtors Chapter 11 cases in the Bahamian proceedings, but she is available via Zoom, should the court have any questions about the intricacies of Bahamian liquidation law. But I'd like to offer their declarations into evidence as exhibits 1 to 4 on the exhibit list we distributed to the parties in interest in the court, and also move into evidence, Exhibit 5, which is an order from the Supreme Court of the Bahamas regarding the JPL's ability to commence the Chapter 15 action.

Okay. Anyone have an objection to the introduction of the evidence? Your Honor, Jim Bromley from Salton and Cromwell on behalf of the Chapter 11 debtors. We do not have an objection for the admission of the evidence with respect to the recognition proceeding. But there are certain aspects of the declarations, which we believe go beyond the four corners of the Chapter 15 recognition. So as long as it's limited just to Chapter 15 recognition, just to this hearing and just to this relief, we have no objection. All right. They're admitted without objection. Okay.

As for the motion itself, as part of the cooperation agreement that we entered into the debtors, we agreed to support thereafter. As for the motion itself, as part of the cooperation agreement that we entered into with the debtors, we agreed to support their application for recognition in the Bahamas. They agreed to support our application here, and we took their comments on the order. We then reached agreement on language with the DOJ, the U.S. trustee, and the committee. So as I said, the form of order which has been agreed to by the parties is the docket 1.5,000, cases at docket 125. I do want to note that there have been a number of informal letters submitted by Mr. Leslie Stewart, the Hainian citizen. Specifically, he sent a letter that

was docketed in the Chapter 11 cases at Docket 357 and some others. We don't believe any of them constitute an objection to recognition but wanted to raise this to your honor's attention. I did see those letters. I directed the be put on the docket just because they wanted to be able to see what kind of things that I'm receiving from yes your honor so unless the court has any questions we respectfully request the court enter the amended proposed order and we moved to the status update anybody wish to be heard on the recognition satisfied the relief is appropriate I will enter the order so so just I want

to give your honor a sense of where the JPLs have been and and and as I said, give a kind of six-month look forward, so you know what's going on. And I'll focus on, if you think of the debtor's presentation and the silos, FTCD digital is a subsidiary within the FTX international platform, that international silo. Now, at the first day presentation may have left the court with the impression that the FDX digital estate played an undersized role in the saga,

and I do want to address that because it is actually, from our perspective, of a big piece of the puzzle that's going to need to get resolved. At the time of the collapse, Digital employed 84 persons, including 38, who were transferred over from other FTX debtor entities, including the board and key management personnel. That company was the headquarters in Nassau Bahamas. It's one of 52 properties that the JPLs have identified in the Bahamas, all held in the name of Chapter 11 debtor in this case, FTA. FTX property holdings. Amongst those properties was a deluxe office suite, residential

complexes and accommodations for the employees, and a six-acre FTX campus in New Providence, Bahamas. All of these properties, we seem to think, are worth north of $250 million. They were financed by FTX digital and are on FTX's digital's balance sheet as intercompany receivables. As part of the cooperation agreement, we've agreed with the debtors that the JPLs will take the lead on liquidating that real estate in the Bahamas. So there is a big real estate piece in FTX digital. There was a motion to dismiss. I thought it was the Turkish proceeding that did get dismissed. I thought I remembered seeing another one for one of the Bahamian entities. Yes, Your Honor. The property is in the government.

The Bahamas are actually owned in fee by a U.S. debtor. And the joint provisional liquidators did file a motion to dismiss that individual proceeding. That's been resolved. That, sorry. Yes, that one has been resolved as part of the cooperation agreement. We're going to go ahead and market and sell those assets, and then we're going to have a discussion about where those assets go at a later date. So I need to put something on the docket to close that out.

close that out, close that motion out. Okay, well we can address that. So of the 84 employees who were living in the Bahamas at the time, there are 16 employees who remain working on a variety of forensic matters and assisting with ongoing investigations. But moving back in time, as Mr. Bromley said at that first day hearing, the FDX International platform was primarily a digital assets trading and exchange platform for not U.S. citizens.

To that end, FTX was created, FTX Digital was created in July 2021 for maintaining, for the purpose of migrating the business. Remember Mr. Bromley said that the entity was moving around the country and then offshore. It was all going to be moving to the Bahamas where this giant real estate conglomeration was and the headquarters. And that was going to allow FTX group to take advantage of the Bahamas' favorable regulatory environment and the newly created DARE Act, which you've kind of heard about.

The question that's going to come up in this case is what was the status of that movement between the time that digital was created and FTX and digital filed their respective proceedings? And I'm going to come back to that migration concept in a bit. But I did want to give Your Honor a sense before I get there of how the Bahamian proceeding is going to go along. The Bahamian proceedings are either voluntary or court supervised, ours is court supervised. To that end, Mr. Sims, Mr. Greaves, and Mr. Cambridge were appointed as joint provisional liquidators.

They, the Supreme Court of the Bahamas has exclusive jurisdiction, right? Your Honor has exclusive jurisdiction over assets worldwide of the debtors. The Supreme Court of the Bahamas is the one that has exclusive jurisdiction over insolvency proceedings and has broad authority to make winding up orders for all types of companies. When a company is being wound up compulsively by the court, the court issues an order, which describes the steps. that the liquidators must take to liquidate the company. And the liquidator then, as the JPLs here,

have been filing periodic status updates with the Bahamian court as to how they're doing on the order laying out their duties. Once appointed, liquidators generally gather assets, distribute company's assets to the creditors on a peri-pesu basis. They have broad authority to be. to bring and defend lawsuits, file claims,

engage in business on behalf of the debtors. So it's best really to think about the JPLs as Chapter 11 debtors. There are some distinctions. But normally the process runs that way. So to that end, over the past few months, let's talk about what they've been doing. And then I'll come to what needs to get done.

Beginning right from appointment, the JPLs took steps. to identify and gain custody of cash. They've identified approximately $143 million of cash held by Silvergate and Moonstone, which Your Honor may have heard about. We filed requests for provisional relief with respect to those funds. And then, as the court knows, the US Department of Justice

sees the funds. But the JPLs are an active discussion with the DOJ with respect to the release of the funds and hope to have a consensual resolution on that. The JPLs also established cash management controls to ensure proper stewardship and security over the estate funds, much like the debtors have been doing, and the controls include rolling cash flow forecasts, payment approval controls, anti-money laundering, treasury controls, and all the things that you would expect a

US Chapter 11 trustee to do. There have been significant efforts and it's part of their requirements to communicate with customers and creditors. The JPLs launched a general informational website and creditor portal website. They've also sent letters out to approximately 2.4 million of potential customers, inviting them to register their contact information in order to receive updates of what's going on. They've also been, much like the U.S. debtors, been in active communications. with regulators in the Bahamas and in the US and participating in investigations as well.

We have been active in the Chapter 11 case. I'll get to it. We believe we're a very large creditor in these cases. But the main goal which we reached early on in the case was the cooperation agreement, which honor which this court has approved and the Bahamian court has approved and it just gives us a framework from which we're going to try to figure out how the two proceedings are going to be done. This is where we are just to get a sense of the current financial picture, not evidence, but just give your honor a sense of the size of what we're talking about.

As I said, there's about 220 million in cash, 143. subject to the DOJ seizure order. There's the $276 million receivable relating to the property. But so far, the JPLs have traced two major sources of outflows from their accounts in the lead-up to the case. $5.6 billion was transferred from F.TX digital custodial accounts to a U.S. debtor at FTX trading and $2.1 billion was transferred from FTX Digital Custodia accounts to Alameda, another Chapter 11 debtors. So to get the proper sense of the size here, we're talking about $7.7 billion of cash outflows from the Bahamian estate to the U.S. debtors.

And then we have other tangible assets of about $3 million, mostly relating to office furniture equipment. and the fleet of cars that the employees had in the Bahamas. So that's where we stand right now. Over the next six months, we've got to deal with the customer migration issue, obviously determining whether customers were customers of U.S. debtors or digital is going to be critical to any distribution scheme. We've got to address the issue of customer trust claims, as has happened in many other crypto cases.

There are unresolved legal and factual issues as to the nature of the customer's deposits, whether they're held in trust, whether they're general unsecured claims, and we're going to need to work through that. We've got open trade contracts that we're going to need to address and see if there can't be a way to restructure the platform. And then, as the debtors are doing here, there's a ton of work being done into antecedent transactions, not just in her company, but also with respect to third parties to determine whether those third parties or any of the persons associated with the transactions need

to bring money back into the estate. So as I said, there's a lot of work that needs to be done. I'm not sure how much of it is going to need the involvement. of the court, but we may be back seeking additional relief from the court to be able to get all that stuff done. And unless Your Honor has any questions, I just think we it probably best to set a status conference sometime in the May-June timeframe and come back and kind of tell you where we are on those issues and then give you a look forward again just so you're not wondering what's happening with your Chapter 15 case. Okay. I appreciate the update, Mr. Shore.

We'll find a, why don't we set a status conference for May 17th at 10 a.m. All right. Thank you very much, Your Honor. Thank you. Appreciate it. Mr. Molly? Your Honor, I just would like to mention a couple things from our perspective. One is we did have a hearing yesterday in the Bahamas, and the Supreme Court of Bahamas has agreed to enter an election. order that will be consistent with the order that your honor will enter here to allow the two proceedings sets of proceedings to be recognized the US proceedings being

recognized in the Bahamas the Bahamian proceedings being recognized here in the United States I don't know if you're just not speaking into the microphones or I'm sorry I'm a little a little rough today yeah I know the feeling I wish I could say it was because I was out drinking last night but it wasn't I was wasn't either, my. Your Honor, just wanted to point out, there was a hearing yesterday in the Bahamas. The Supreme Court of the Bahamas has agreed to enter an order to recognize the Chapter 11 proceedings in the Bahamas so that there will be a coincident recognition in both jurisdictions. So we'll have a recognition here, a recognition in the Bahamas.

And the cooperation agreement had required that both the orders be able to be able to. entered so they're mutually dependent on each other. The other thing I'd like to say, Your Honor, I hadn't been aware that Mr. Shore was going to make any comments about issues and one of the things that are coming up. And I do think that it's important that the Chapter 11 debtors also make a statement here. Many of the points that Mr. Shore mentioned is in terms of things like assets that were in digital market accounts or the migration of customers and the things of that sort. Those are all open issues.

The cooperation agreement is a starting point, but the issues as to whether assets belong in the Bahamian estate or in the U.S. estate are open issues. And so the statements that Mr. Shore has made in that regard are statements that the U.S. debtors reserve all their rights on and frankly disagree with many of it. Understood. Thank you, Your Honor. Thank you. Anything else? Where do we stand on the examiner? You know what I was going to ask, Mr. O'Anne. Thank you, Your Honor. For the record, Adam Landis and Landis, Ruthen Coffman, and the Chapter 11 debtors. Yes, I saw that question coming, and I can represent to the court that the parties have been discussing this periodically, sometimes more frequently than others, but there are discussions going back and forth.

We've identified a couple of potential fee examiners, and we're trying to come to ground to have an agreement on this rather than submitted to the court for the court's determination. So we're still working on that. We hope to have it done soon, and we do appreciate that the court is not going to approve any fee applications unless and until a fee examiner is appointed and has an opportunity to review those applications. Okay. Thank you.

All right. Anything else? All right. Well, it turned out to be a lot shorter hearing than I have anticipated. I appreciate everyone's cooperation. I appreciate the updates and we are adjourned. Thank you. Thank you. Thank you. Your Honor.