On Monday, a judge ruled that the New York Mets’ owners have to pay up to $83 million to the Bernard Madoff trustee overseeing the repayment of investor money. However, he expressed doubt that the trustee, Irving Picard, will be able to prove at a March 19 trial that he should receive anything more than $300 million.
The judge, U.S. District Judge Jed S. Rakoff, wrote a four-page ruling to assist with the March 19 trial. This comes after Picard tried to get the Mets’ owners to pay as high as $1 billion in a fund that would repay the thousands of investors that had been cheated by the lengthy Madoff fraud.
Rakoff has been involved in the case since last year and had previously ruled that team’s owners wouldn’t have to pay more than $386 million to Madoff investors, according to AP. He said they would probably have to pay up to Monday’s $83 million figure after Picard had been tasked with proving the owners “willfully blinded” themselves to fraud to acquire more.
In addition, Rakoff’s ruling on Monday has the $83 million amount to be determined by him at a later time through a written decision as he will first hear from both parties’ lawyers.
Now, the Mets’ owners lawyers had requested that Picard not get any additional money. This was also rejected by Rakoff and if he hadn’t done so, the two sides could have avoided a trial. However, Rakoff did say that he “remains skeptical that the trustee can ultimately rebut the defendants’ showing of good faith.”
He also noted that evidence in court papers by the two sides may not be allowed at the trial. He said, “Conclusions are no substitute for facts, and too much of what the parties characterized as bombshells proved to be nothing but bombast.”
With Rakoff’s rulings, it should come as good news for the Mets co-owners Fred Wilpon and Saul Katz, who have maintained they were also victims of Madoff’s fraudulent actions. In 2011, the Mets said they were considering the sale of up to 25 percent of the team due to the lawsuit’s “uncertainty.”
Fast forward to 2012 and Wilpon said just last week that that the owners are going to keep the franchise “for a very long time.”
Picard’s Case
Monday’s ruling stems from Picard suing the Mets’ owners and alleging they should have had knowledge that Madoff was “acting illegally.” He said in the lawsuit that the owners gained $83.3 million in fake profits and a $301 million principal in the two years prior to the bankruptcy filing for the Madoff assets.
Meanwhile the Mets’ lawyers have said that their client did not know Madoff wasn’t investing their money, similar to Picard.
The Mets owners aren’t the only ones affected by Madoff’s fraud. He defrauded almost 5,000 investors, telling them the $20 billion investment had grown more than three-fold by November 2008 to $68 billion. He soon confessed after that and said just a several hundred million dollars remained.
Neither Picard nor the Mets had an official comment about Monday’s ruling.
