In re Celsius Network LLC

In re Celsius Network LLC

Opinion

 [*167]  MEMORANDUM OPINION AND ORDER DENYING MOTION FOR THE APPOINTMENT OF AN OFFICIAL PREFERRED EQUITY COMMITTEE

MARTIN GLENN

CHIEF UNITED STATES BANKRUPTCY JUDGE

Pending before the Court is the motion (the "Motion," ECF Doc. # 880) of Community [*168]  First Partners, LLC, Celsius SPV Investors, LP, Celsius New SPV Investors, LP, and CDP Investissements Inc. (collectively, the [**2]  "Requesting Equity Holders") as beneficial holders, or investment advisors managers of beneficial holders, of Series B Preferred Shares issued by Celsius Network Limited ("CNL" and, together with its affiliated debtors and debtors in possession, the "Debtors" and, the Debtors and their non-Debtor affiliates, collectively, the "Celsius Entities"), for entry of an order appointing an official committee of the holders of CNL's preferred equity securities (an "Official Preferred Equity Committee"). The Debtors filed an objection, (the "Debtors' Objection, ECF Doc. # 1045). The Official Committee of Unsecured Creditors (the "Committee") also filed an Objection (the "Committee's Objection," ECF Doc. # 1048.) Additionally, Andersen Invest Luxembourg S.A. SPF ("Andersen"), a .05% equity security holder in CNL, filed a joinder (the "Andersen Joinder," at ECF Doc. # 924.) The Requesting Equity Holders filed a reply (the "Reply," ECF Doc. # 1120) and an accompanying declaration from Andrew M. Leblanc (the "Leblanc Declaration," ECF Doc. # 1122) both of which the Requesting Equity Holders sought, via a sealing motion, (the "Sealing Motion, "ECF Doc. # 1118") to file with redactions.¹

For the [**3]  reasons explained below, the Requesting Equity Holder's Motion is DENIED.

I. BACKGROUND

A. General Background

On July 13, 2022 (the "Petition Date"), the Debtor filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code. (Motion ¶ 18.) On July 27, 2022, the U.S. Trustee appointed the Committee, which is comprised of seven members, each of whom holds crypto assets through the Celsius platform. (Id. ¶ 20.) On September 14, 2022, the Court appointed an examiner in these Chapter 11 Cases. ( See ECF Doc. # 820.) At a hearing on September 1, 2022, the Debtors noted that they had engaged in meaningful discussions with the UCC regarding a business plan and a potential restructuring and that both parties agreed to a comprehensive diligence reporting framework. (Motion ¶ 21).

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