Picard seeks $83M payback from Mets owners
The trustee in the Bernard Madoff case wants a federal judge to order the owners of the Mets to fork over $83 million in fictitious profits received in the giant Ponzi scheme without having to wait for a scheduled March trial, new court filings show.
In asking for a partial summary judgment in his fight with the Wilpon family and their partners in Sterling Equities, trustee Irving Picard said that because his investigation has shown that the Sterling partners received the $83 million, they should be made to pay it back under federal bankruptcy law.
Because the Wilpons and their partners received the profits within two years of Madoff's business collapse, the law requires they turn it over so it can be "distributed fairly among the thousands of defrauded customers of [Madoff]," Picard said.
The request for the money from the financially stressed owners of the Mets came in a flurry of filings made late Thursday in Picard's lawsuit against the Wilpons, associate Saul Katz and their other partners.
Picard sued the Wilpon defendants late last year for as much as $1 billion, alleging that they knew or should have known Madoff was running a scam. Picard said the Wilpons received over $1.5 billion from Madoff's operation between 1985 and 2008. About $295 million of that represented fictitious profits over that period, Picard said.
But Manhattan federal Judge Jed Rakoff ruled in September that Picard could seek only two years' worth of fake profits, about $83 million, and could only recover the principle of about $303 million if he proved "willful blindness" of the Wilpons to Madoff's scheme.
A trial for the recovery of the fake profits and the principal amount is set for March 19, but Picard is asking Rakoff to decide now on the phony profits issue.
A Sterling spokesman declined to comment. Sterling has until Feb. 9 to reply to Picard's motion.
In their own filings Thursday, Sterling, the Wilpons and Katz made a separate summary judgment motion to Rakoff charging that Picard couldn't prove the "willful blindness" needed to recover hundreds of millions of dollars in fictitious profits and principle.
In a 45-page document, lawyers for Wilpon and Katz said their clients were unaware of the multibillion-dollar house of cards that Madoff ran and they didn't take deliberate steps to avoid finding out about it. With Zachary R. Dowdy