Bloomberg News

Madoff Trustee Can Have Jury Trial Against Mets Owners

November 24, 2011

(Updates with excerpt from ruling in fourth paragraph.)

Nov. 23 (Bloomberg) -- The trustee liquidating Bernard Madoff’s firm can have a jury determine whether he’ll recover allegedly improper transfers of funds from the confidence man to the owners of the New York Mets.

U.S. District Judge Jed Rakoff said in an order today that the trustee, New York lawyer Irving Picard, has a right to let a jury instead of Rakoff himself decide the issue when the case goes to trial on in Manhattan on March 19.

The judge in September dismissed most of Picard’s $1 billion claim against Sterling Equities Inc. partners Fred Wilpon and Saul Katz, who own the Mets Major League Baseball team. Rakoff didn’t say whether Picard can successfully maintain a “fraudulent conveyance” claim against them.

“Madoff Securities might well be barred from bringing fraudulent conveyance claims on the facts of this case; but if it could bring such claims, it would have a right to a jury trial,” Rakoff said in the ruling today.

Danielle Sessa Parillo, a Mets spokeswoman, had no immediate comment on the ruling.

Picard originally demanded $300 million in profit and $700 million in principal from the Mets partners, saying they turned a blind eye to Madoff’s Ponzi scheme. The partners denied the allegation.

To recover the profit, Picard must prove the Mets owners didn’t give equal value back to Madoff’s firm for money received from their Madoff accounts, Rakoff said in his earlier ruling. Rakoff said Picard could try to reclaim about $386 million, based on bankruptcy claims.

The case is Picard v. Katz, 11-cv-03605, U.S. District Court, Southern District of New York (Manhattan).

--With assistance from Patricia Hurtado and Linda Sandler in New York. Editors: Andrew Dunn, Peter Blumberg

To contact the reporters on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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