FTX Appeals Court Decision to Permanently Redact User Names
• Major media outlets have filed an appeal to overturn a bankruptcy court’s decision to redact the names of FTX users.
• The media houses argued that there is a “presumptive right” for the public to inspect bankruptcy filings and that keeping the names concealed effectively denies that right.
• Last week, FTX filed a complaint in Wilmington, Delaware, bankruptcy court asking back $700 million its founder Sam Bankman-Fried transferred to K5 entities in 2022.
Media Houses Appeal Redaction Decision
Several major media outlets have filed an appeal aiming to overturn a bankruptcy court’s decision to redact the names of FTX users permanently. In a recent filing with the US Bankruptcy Court for the District of Delaware, The New York Times , Dow Jones & Company , Bloomberg , and the Financial Times argued that there is a “presumptive right” for the public to inspect bankruptcy filings and that keeping the names concealed effectively denies that right.
Previous Attempts at Unsealing Names
The media houses previously filed a motion to have the names of FTX creditors unsealed in December 2022, but Bankruptcy Court Judge John Dorsey ruled to keep the customer names sealed for three months. When the media companies again filed an objection to the redaction decision in May 2023, Judge Dorsey sided with FTX once more, prioritizing creditors’ safety and ordering FTX to “permanently redact” the names of its customers.
Third Attempt at Disclosure
Now, the media houses are making a third attempt to have the names of FTX creditors disclosed, with lawyers representing them arguing that FTX is not entitled to an exception from disclosure simply because its customers used cryptocurrency. In his latest ruling, Judge Dorsey claimed that publishing individual customer’s name could put them at risk of scams and identity theft. He stated it was important for customers’ safety and wellbeing not fall victim any type of scam or fraudulence. Additionally he granted permission to FTX temporarily remove company and institutional investor’s name from its customer list; however another request must be made within 90 days if they want their names kept redacted.
FTX Seeks Funds Returned by Bankman-Fried
Last week, FTX filed a complaint in Wilmington Delaware bankruptcy court asking back $700 million its founder Sam Bankman-Fried transferred K5 entities in 2022 without receiving anything in return according their claims . They claim he was sending money as “profligate patron” after attending social event hosted by Michael Kives one co-owner along with Bryan Baum who own K5 Global entity . Now they are seeking funds return based on those transfers .
In conclusion major news publications are making third attempt at disclose customer’s name connected with now bankrupt exchange while simultaneously trying retrieve funds sent by founder without receiving anything return . Both these issues remain unresolved as time passes .