U.S. law firm Lehotsky Keller Cohn filed a lawsuit against a committee of the bankrupt Bitcoin miner Rhodium Enterprises ' board and an investor group on Feb. 13.
The Texas-based law firm sued the miner for allegedly blocking the legal fee of $11 million and attacking its reputation.
Related: Another crypto company files for Chapter 11 bankruptcy
Rhodium filed for bankruptcy protection in August 2024
Rhodium is a Bitcoin mining firm that filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of Texas in August 2024. The filing mentioned six subsidiaries:
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Rhodium Encore
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Jordan HPC
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Rhodium JV
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Rhodium 2.0
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Rhodium 10MW
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Rhodium 30MW
Chapter 11 is a type of bankruptcy that reorganizes a struggling company's debts to allow it to stay open and become solvent. A court-appointed trustee oversees the reorganization.
As Rhodium goes through the bankruptcy process, it faces a lawsuit from its special litigation counsel.
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Lehotsky Keller Cohn sues Rhodium's board committee and investor group
In the lawsuit filed in the U.S. bankruptcy court in Houston, Lehotsky Keller Cohn claimed that a board committee and a group of investors at Rhodium orchestrated a "scorched-earth" effort to not only delay but also lower payment of a legal fee for helping the miner reach a $185 million settlement with Whinstone last year.
Whinstone is a unit of Riot Platforms (Nasdaq: RIOT), a major Bitcoin mining company.
The law firm represented Rhodium before it filed for bankruptcy protection in August 2024. Once the Bitcoin miner filed for Chapter 11 bankruptcy, the law firm offered its services as special litigation counsel.
During the bankruptcy proceeding, a special board committee at Rhodium was supposed to take care of the process. But it refused to negotiate with the law firm over the size of its stake in the Whinstone settlement and actively worked toward delaying the legal fee, Lehotsky Keller Cohn alleged in the lawsuit.
Worse, the special board committee made public accusations that Lehotsky Keller breached its client duties and committed malpractice, the lawsuit claimed.
The law firm claimed to have spent over $1.5 million in fees and expenses to defend itself against Rhodium's "baseless attacks" and recover its success fee.
Though a judge approved the law firm's success fee in December last year, the special committee and investor group at Rhodium have appealed the order, Reuters reported .
Related: What is Bitcoin mining? Explained
This story was originally published by TheStreet on Feb 18, 2026, where it first appeared in the Bankruptcy News & Analysis section. Add TheStreet as a Preferred Source by clicking here.
