Paul, Weiss, the law firm that supports FTX CEO Sam Bankman-Fried (SBF) in the midst of bankruptcy, renounced to represent the entrepreneur, citing a conflict of interest. The decision to step down from representation after SBF’s tweets has disrupted the law firm’s reorganization efforts.
From November 14, SBF published a series of tweets that caught attention on Crypto Twitter. The move, however, sparked speculation that encrypted tweets were being used to prevent bots from noticing simultaneously deleted tweets. Although no ill intent can be concluded, Paul, Weiss’ attorney Martin Flumenbaum believed that SBF’s “incessant and disruptive tweets” were having a negative impact on the reorganization efforts:
“We advised Mr. Bankman-Fried several days ago after FTX filed for bankruptcy that disputes arose which prevented us from representing him.”
The law firm’s decision to forego helping SBF coincided with a much-anticipated decision by fellow fraudster Elizabeth Homes, who was sentenced to prison after being found guilty of criminal fraud.
SBF is currently under scrutiny in several directions, including ongoing investigations into the misuse of client funds and the disclosure of bankruptcy-related documents.
Despite notifying the defendants, the court can deny an attorney’s request and order them to continue representing themselves, which may seem impossible given SBF’s behavioral concerns raised by the law firm.
Recently, Changpeng “CZ” Zhao, CEO of Binance opened around the time Binance was almost ready to bail out FTX from a meltdown. Reflecting on the situation, he said:
“When he came to see me, I knew he was desperate. If we can’t help him, there’s probably no one else who will. Probably a group of people transmitted the agreement before us.
However, the buyout deal was called off after due diligence revealed bigger issues.