Mets Ruling Used Within Days as Weapon in Fighting Madoff Trustee Suits

A judge’s ruling that slashed a billion-dollar claim against the owners of the New York Mets three days ago is already being used as a weapon by other defendants in lawsuits brought by the liquidator of Bernard Madoff’s firm.

Safra National Bank of New York yesterday asked a bankruptcy judge to dismiss a suit by trustee Irving Picard, citing U.S. District Judge Jed Rakoff’s Sept. 27 ruling. Rye Select Broad Market XL Portfolio Ltd., based in the Cayman Islands, separately asked a federal district judge to take its Madoff suit out of U.S. bankruptcy court, citing Rakoff’s decision in the case against Fred Wilpon and Saul Katz.

Rakoff cut Picard’s claim against the Mets owners to about $386 million and raised the standard for him to get even that much. The judge said Picard could try to reclaim only two years of withdrawals from the Ponzi scheme, while dismissing nine of 11 causes of action against Wilpon and Katz.

Privately owned Safra, which is fighting Picard’s demand for about $112 million allegedly invested with Madoff through so-called feeder funds, said in a filing that “at a minimum” Picard’s demand for funds it took from the Ponzi scheme beyond two years should be dismissed. Rye, sued for $400 million, said its case involving swap transactions was similar to the Mets case, and that Rakoff sided with the defendants saying settlement payments were protected by so-called safe harbor law.

Read the complete article here: Mets Ruling Used Within Days as Weapon in Fighting Madoff Trustee Suits – Bloomberg.

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