In a Court filing on Wednesday, the U.S. Trustee, a Department of Justice (DOJ) branch, directed the Delaware Bankruptcy Court to reverse its previous ruling on the independent examiner’s decision in the FTX bankruptcy case.

According to reports, the Trustee has stated that the Bankruptcy Court erred in its ruling during a court hearing held in February. The court had rejected the appointment request in a case where the criteria for appointing an examiner were met, including the requirement that the bankrupt estate has over $5 million in “qualifying liabilities.”

In the February hearing, Judge John Dorsey from the Delaware bankruptcy court took the initiative by siding with the FTX estate. During the proceedings, Dorsey argued that the ongoing case and investigation could incur costs exceeding $100 million. Additionally, Dorsey emphasized that the inquiry would inevitably result in a slowdown of the proceedings.

In response to complaints raised by the parties involved in the FTX case regarding the purported costs of appointing an examiner, DOJ Trustee Andrew R. Vara emphasized that such expenses, whether alleged or not, do not provide sufficient justification to deviate from the statutory requirement of appointing an examiner when the statutory criteria are met. This stance was expressed by Vara in the filing, taking into account both legal and practical considerations.

The filing came as a surprising development after the FTX crypto enterprise filed for bankruptcy in November, sending shockwaves throughout the cryptocurrency industry. Notably, the founder of FTX, Sam Bankman-Fried, is currently facing criminal charges in the United States.

The case has garnered significant attention and scrutiny, making the appointment of an examiner a crucial step in the ongoing proceedings.

This comes after the emergence of evidence provided by Daniel Friedberg, a former executive at FTX, a class-action lawsuit has been initiated against celebrities who are accused of endorsing the now-defunct FTX exchange.

Friedberg’s testimony has revealed that promotional activities for FTX originated from Florida, which challenges the claims, suggesting that the Miami court lacks jurisdiction and that the allegations are unrelated to Florida. This new evidence introduces a creative perspective and strengthens the association between the claims and the state of Florida.