A cohort of media houses, which includes Dow Jones & Company, Bloomberg, The New York Times, and the Financial Times, filed an appeal on June 23 to overturn a bankruptcy court’s decision to redact the names of FTX users permanently. FTX had filed for bankruptcy in November 2022. Since then, FTX lawyers and users have advocated to keep the list of FTX’s nearly 9 million creditors confidential as disclosing the names of FTX customers would expose them to the threat of scams and identity theft.
In typical bankruptcy proceedings, the list of creditors is normally made public, such as in the Celsius bankruptcy case. However, in December 2022, the four media giants filed a motion to have the names unsealed, yet bankruptcy court judge John Dorsey sided with FTX lawyers and ruled to keep the customer names sealed for three months. The media houses again filed an objection to the redaction decision in May 2023. They argued that the public has a “presumptive right” to inspect the FTX bankruptcy filings but the judge again ruled in favor of FTX on June 9.
Judge Dorsey prioritized creditors’ safety by ordering FTX to “permanently redact” the names of its customers and asked the names of companies and institutional investors to be kept temporarily sealed, which was in accordance with the exception of the bankruptcy law, which considers the risk of harm by disclosure. With the recent filing, the news organizations are attempting to have the names of FTX creditors disclosed for the third time. The lawyers representing the firms argue that FTX is not entitled to the “novel and sweeping exception” to the disclosure requirements, simply because its customers used cryptocurrency.
