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Wednesday, November 23, 2011

NY Times: Mets Owners could face jury if Madoff case goes to trial

According to the NY Times, The owners of the Mets will face a jury should there be a trial in the case filed against them by the trustee for the victims of Bernard L. Madoff’s fraud, a federal district judge ruled Wednesday. The Mets’ owners had opposed a jury trial.

The case could be settled before the trial is scheduled to begin on March 19. Both sides are in mediation with Mario M. Cuomo, the former New York governor.

In his ruling, Judge Jed S. Rakoff rejected the argument by lawyers for Fred Wilpon and Saul Katz, the Mets’ owners, that a jury trial was precluded when the case was moved from Federal Bankruptcy Court to United States District Court.

The Mets’ owners asserted that the trustee had no standing to a jury trial under bankruptcy law and the Seventh Amendment to the United States Constitution.

Rakoff ruled bankruptcy trustees like Irving H. Picard, who filed the case against the Mets’ owners, “have rights under the Seventh Amendment” to a jury trial. He wrote that Picard did not waive his right to a jury trial by filing the case in bankruptcy court.

Generally, bankruptcy courts are not authorized to conduct jury trials.

Picard has accused Wilpon and Katz of being willfully blind to warnings that Madoff was up to no good during their many years of investing with him and sought to recover $1 billion in principal and “fictitious profits.”

Wilpon and Katz have denied having any such knowledge and have accused Picard of inventing and twisting evidence.

In September, Rakoff tossed out 9 of 11 counts against Wilpon and Katz and reduced their maximum financial liability to $386 million. That ruling might have given Wilpon and Katz confidence in having the case decided by Rakoff instead of a jury faced with a complex case involving securities and bankruptcy law.

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