Mets owe up to $83M to Madoff investors
A judge ruled Monday that the New York Mets’ owners owe up to $83 million to the trustee recovering money for Bernard Madoff investors, though he expressed doubt that the trustee will succeed in proving at a trial this month that he’s entitled to as much as $300 million more.
U.S. District Judge Jed S. Rakoff issued his four-page ruling to narrow the subject of a March 19 trial in Manhattan that results from Trustee Irving Picard’s effort to force the club’s owners to pay as much as $1 billion into a fund established to repay thousands of investors cheated of billions of dollars during Madoff’s decadeslong fraud.
Last year, Rakoff had ruled that the team’s owners wouldn’t owe more than $386 million to other Madoff investors. He made it clear then that they would likely owe up to $83 million but said the trustee must prove that the Mets’ owners ”willfully blinded” themselves to Madoff’s fraud to get more.
His ruling Monday determined that the exact amount up to $83 million won’t be left to the jury but will be decided by him in a future written decision, likely after he hears more from lawyers on both sides.
Rakoff rejected a request by lawyers for the Mets’ owners to rule that Picard was not entitled to more money, a ruling that would have eliminated the need for the trial.
But he said he ”remains skeptical that the trustee can ultimately rebut the defendants’ showing of good faith.”
He said he was concerned that much of the evidence offered by both sides in court papers so far would not be admissible at trial.
”Conclusions are no substitute for facts, and too much of what the parties characterized as bombshells proved to be nothing but bombast,” he wrote.
Messages left for comment with both sides in the dispute weren’t immediately returned.
The trustee previously sued the Mets’ owners, saying they had to know Madoff was acting illegally. Lawyers for the Mets’ owners have repeatedly said that their clients had no idea Madoff wasn’t investing their money as he said he was.
Thousands of investors lost billions of dollars in the fraud, which Madoff revealed in December 2008 when he confessed that statements telling investors they had about $68 billion weeks earlier were fraudulent. In fact, only several hundred million dollars were left.
In his lawsuit, Picard said the Mets’ owners received $83.3 million in fictitious profits and $301 million in principal in the two years before a bankruptcy filing was made regarding the Madoff assets.
Madoff is serving a 150-year prison sentence in North Carolina for his multibillion-dollar fraud.