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Monday, October 24, 2011

Mets Owners Say, "Judge Shouldn't Approve Irving Picard's Appeal"

U.S. District Judge Jed Rakoff shouldn't approve the liquidator of Bernard Madoff's firm to appeal a ruling that cut a $1 billion case against the New York Mets owners by two-thirds, the team owners said.

Trustee Irving Picard assailed Judge Rakoff's ruling earlier this month, saying it “arbitrarily” allowed Fred Wilpon and Saul Katz to keep fictitious profits from the Ponzi scheme. Mr. Picard asked the judge to make a final ruling so he could appeal, or to allow an appeal before trial. The Major League Baseball team's owners urged Judge Rakoff to reject the request in a court filing.

“There is no hardship or injustice that would result from waiting another six months to raise any and all appealable issues at one time,” Messrs. Wilpon and Katz said in the Oct. 21 filing in U.S. District Court in Manhattan.

A spokeswoman for Mr. Picard didn't immediately respond to an e-mail seeking comment on the filing.

Judge Rakoff last month set a March 19 trial date for Mr. Picard's remaining case against the Mets owners after dismissing nine of 11 counts. He said Mr. Picard could try to take back two years of money withdrawn from the Ponzi scheme, or about $386 million.

Withdrawals that exceeded principal could be recouped if the trustee showed the team owners didn't give “value” back, while for other transfers he would have to prove that the investors were “willfully blind” to the Ponzi scheme, Karen Wagner, a lawyer for the Mets owners, said in the filing.

Judge Rakoff's decision limiting Mr. Picard to two years of withdrawals may cost the trustee about $2.7 billion on all of his clawback suits, Mr. Picard has said. Another $3.5 billion of so-called preference payments is “in question” because of another aspect of Judge Rakoff's ruling, he has said.

Separately, Mr. Picard is fighting with Messrs. Wilpon and Katz over whether he has a right to a jury trial. They say bankruptcy claims don't carry a right to a jury trial.

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