The trustee for victims of Bernard Madoff's Ponzi scheme delayed an initial distribution of $272 million scheduled for September 30 to former Madoff customers with valid claims, citing a recent court decision involving owners of the New York Mets baseball team.
Trustee Irving Picard said Tuesday's decision by U.S. District Judge Jed Rakoff in Manhattan raised several issues requiring a thorough evaluation of the impact, if any on how much can be distributed and how payouts should be calculated.
We know how difficult this delay is for those who have waited so long to recover the money they lost to Madoff, Picard's chief lawyer, David Sheehan, said in a statement. He said payouts would be made as soon as we possibly can.
On Tuesday, Rakoff threw out nine of Picard's 11 claims against Mets owners including Fred Wilpon and Saul Katz, and reduced the size of that case to $386 million from $1 billion.
The judge said Picard could try to recover fictitious profits and principal that was paid out only in the final two years of the fraud, not the final six years as Picard had sought. Another part of the decision limited recoveries related to the last 90 days of the fraud.
(Reporting by Jonathan Stempel in New York; Editing by Ted Kerr)