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An international law firm representing groups of Celsius investors has filed a motion to appoint a committee to represent their interests in the crypto lending firm\u2019s bankruptcy case.<\/p>\n
In a Thursday filing with the U.S. Bankruptcy Court in the Southern District of New York, lawyers with the law firm Milbank requested the appointment of an “Official Preferred Equity Committee” to represent certain Celsius shareholders. According to the filing, the equity holders \u201curgently require their own fiduciary\u201d for representation in court alongside Celsius debtors and an Unsecured Creditors Committee, or UCC.<\/p>\n
\u201cThe need for a fiduciary to pursue the Equity Holders\u2019 interests is particularly critical when one considers the practical realities of these cases: There are only two groups of real economic stakeholders \u2014 the retail customers and the Equity Holders,\u201d said the court filing. \u201cNot only is the UCC laser focused on maximizing value for the customers, without regard for the Equity Holders, but the Debtors also have made it abundantly clear that the UCC is their partner, and these cases are \u2018all about the customer.\u2019\u201d<\/p>\n
The legal team added:<\/p>\n
\u201cAn estate fiduciary is needed to take the other side of this dispute before a plan of reorganization is proposed that violates the Bankruptcy Code […] An Official Preferred Equity Committee should be appointed now \u2014 and not after the fact \u2014 or these cases will be inappropriately and inequitably skewed in favor of the customers to the detriment of the Equity Holders.\u201d<\/p><\/blockquote>\n
The shareholders included investors in Celsius\u2019 Series B $750-million funding round from November 2021, one of the last before the firm filed for Chapter 11 bankruptcy in July 2022. A hearing on Milbank\u2019s motion will be held on Oct. 6 \u2014 the same day the court was scheduled to decide on a motion allowing Celsius to sell its stablecoin holdings to generate liquidity to help \u201cfund the Debtors\u2019 operations.\u201d<\/p>\n
\nWe expect to soon begin the Claims process. Our objective is to make the entire process simple and straightforward for all customers.<\/p>\n