Bloomberg News

Shell Fund Joins Appeal of Madoff Judge’s ‘Feeder’ Ruling

October 10, 2011

(Updates with ruling in second paragraph.)

Oct. 10 (Bloomberg) -- Shell Pension Fund, which runs pension plans for Royal Dutch Shell Plc companies, joined an appeal of a court ruling in the Bernard Madoff case that denied customer status to so-called feeder fund investors.

U.S. Bankruptcy Judge Burton Lifland backed the liquidator of the con man’s firm in June, saying investors in feeders can’t file claims for payment with the estate because they didn’t have accounts with the Madoff firm in their own names. More than 50 companies, pension funds and individuals -- from National Bank of Kuwait SAK and Aozora Bank Ltd. to Upstate New York Bakery Drivers & Industry Pension Fund -- appealed the ruling, asking a district judge to decide whether Lifland erred in defining what a customer was.

“The claimants met the statutory definition of ‘customer’ and entrusted their investment funds to the insolvent broker/dealer for investment through intermediaries,” they said in a court filing last week. A copy of Shell’s joinder in the appeal was filed Oct. 7 in U.S. Bankruptcy Court in Manhattan.

Shell Pension Fund had assets of 17.4 billion euros in 2010, according to its website. Shell Pension Fund may have lost about $45 million as a result of its indirect exposure to the Ponzi scheme, Royal Dutch Shell said after Madoff’s 2008 arrest.

The Madoff bankruptcy case is Securities Investor Protection Corp. v. Bernard L. Madoff Investment Securities Inc., 08-01789, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

--With assistance from Bill Rochelle in New York. Editors: Stephen Farr, Glenn Holdcraft

To contact the reporter on this story: Linda Sandler in New York at

To contact the editor responsible for this story: John Pickering at

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