SBF’s Legal Time Seeks to Cross Examine Caroline Ellison Over FTX’s Anthropic Investment

Sam Bankman-Fried’s defense team is preparing to question Caroline Ellison, the former CEO of Alameda Research, over FTX’s investment in AnthropicAI.

The line of questioning would also center around the extent to which Ellison relied on legal counsel when making pivotal decisions during her tenure as the head of Alameda Research, a crypto hedge fund closely linked to SBF’s now-bankrupt FTX crypto exchange.

Ellison, a central figure in the criminal fraud case against SBF and his former romantic partner, took the witness stand on Tuesday. 

During her testimony, she asserted that her advice regarding FTX’s investment portfolio had been disregarded. 

In response, SBF’s legal team is seeking permission from the court to delve into these allegations further.

Defense Seeks to Establish SBF Followed Council’s Advice

Two critical motions were filed by SBF’s legal team following Ellison’s initial testimony. 

The first motion seeks to address the matter of “advice-of-counsel,” a topic Judge Lewis Kaplan had previously highlighted for advance notification should the defense wish to explore it. 

The defense is keen to probe Ellison’s understanding of the role played by lawyers associated with FTX and Alameda in formulating corporate policies, including the activation of auto-deletion features on the messaging platform Signal.

The Department of Justice (DOJ) had previously urged the court to block SBF’s defense from broaching the current valuation of FTX’s investments, arguing that it was irrelevant to the core question of whether Bankman-Fried had misappropriated FTX customer funds for personal use. 

SBF’s Lawyers Request to Bring Up Anthropic Investment 

As reported earlier, the recent fundraising initiatives announced by the artificial intelligence firm, Anthropic AI, raised hopes that FTX creditors may witness more substantial returns if the insolvent exchange liquidates its stake in the AI company.

In their second motion, SBF’s legal team contends that the news concerning Anthropic AI is “crucial context” for evaluating FTX’s expected value analysis. 

They aim to pose broader questions concerning FTX’s investment portfolio in light of this development.

At the conclusion of the court session, Judge Lewis Kaplan engaged in a dialogue with the attorneys regarding the appropriateness of raising these issues during the trial. 

Ellison also holds a personal stake in Anthropic AI, a fact disclosed by a U.S. attorney after the jury exited the courtroom. 

The prosecutor, Danielle Sassoon, expressed reservations about the permissibility of this line of questioning but indicated a willingness to explore it if the court deemed it relevant.