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Wednesday, January 18, 2012

Good News for Freddy Wilpon, Judge denies appeal from Trustee in Mets Madoff Trial

A U.S. District Judge denied an appeal Tuesday from the trustee seeking to recover funds from Bernard Madoff's Ponzi scheme, limiting the potential liability of Mets owners at trial to no more than $386 million.

Judge Jed Rakoff stood firm on his September ruling, keeping trustee Irving Picard from recovering more than the $386 million in principal and fictitious profits that Mets owners Fred and Jeff Wilpon and Saul Katz made in the two years prior to Madoff's exposure as a fraud. Picard had been seeking $1 billion on the standard that as longtime investors, Wilpon and Katz should have known about Madoff's fraud.

Even after Tuesday's ruling, Picard will need to prove that Wilpon and Katz knew of Madoff's fraud before his conviction in order to collect more than $83.3 million in fictitious profits from the Mets owners.

The Mets have not officially commented on the ruling.

A trial date is set for March 19. Rakoff said he did not want to grant Picard's appeal, because it would delay that trial date and slow the case's resolution.

The Mets are currently working to close on the sale of multiple $20 million minority ownership stakes. Parent company Sterling Equities holds an outstanding $25 million loan from Major League Baseball and a $40 million bridge loan from Bank of America.

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