Core Scientific asks judge to mediate Celsius expense claim

Chicago, May 5 – Core Scientific, Inc. is seeking court aid in ongoing disputes with Celsius Mining, LLC (Celsius Network LLC), according to a filing with the U.S. Bankruptcy Court for the Southern District of Texas.

The debtors’ objection stems from an administrative expense claim from Celsius that was submitted on the same day as a $300 million proof of claim, also from Celsius.

Core believes that the administrative should not be allowed and even if were to be allowed it should not be paid, as Core has competing claims against Celsius which it believes exceed the administrative claim.

All of the disputed claims relate to hosting agreements.

Core says that the hosting agreements limit any recovery Celsius may obtain to one month’s fee.

Core is asking that the entire dispute, which stems from the same contract, should be heard together instead of piecemeal. Additionally, Core submits that the dispute would benefit from mediation with judge Isgur or another judge, given the intricacies of the parties’ competing claims against each other, the fact that the dispute needs to be addressed quickly to avoid disrupting Core’s Chapter 11 exit and the fact that both parties are Chapter 11 debtors.

Core also argues that there is no hurry on paying the administrative claim to Celsius as recent operating reports suggest the company is in no critical need of the payment.

However, if Core were forced to pay the claim at the current juncture, it could harm Core and its creditors as it could cause a default under Core’s final debtor-in-possession order, placing post-petition financing and consensual use of cash collateral at risk.

Core Scientific is an Austin, Tex.-based bitcoin mining company. The company filed bankruptcy on Dec. 21 under Chapter 11 case number 22-90341.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.