Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Madoff Trustee Appeals $59 Billion Ruling in UniCredit Suit

Don't Miss Out —
Follow us on:

March 22 (Bloomberg) -- The liquidator of Bernard Madoff’s firm appealed a court ruling that tossed most of his $59 billion in claims against UniCredit SpA, Sonja Kohn and other defendants, following earlier appeals seeking to recover about $30 billion in damages from banks.

Madoff trustee Irving Picard’s notice of appeal and document record were transmitted today to U.S. District Court in Manhattan by a U.S. appeals court, according to filings. U.S. District Judge Jed Rakoff on Feb. 21 dismissed Picard’s claims under the racketeering statute, which allows for triple damages, saying he couldn’t prove his allegations.

Picard now has $90 billion in claims before the appeals court, out of about $100 billion he had demanded in more than 1,000 suits to gather money for customers with Madoff Ponzi scheme losses. Rakoff and another district judge, Colleen McMahon, dismissed the $90 billion in claims in Picard’s suits against banks including JPMorgan Chase & Co., HSBC Holdings Plc, UBS AG and UniCredit, which is a defendant in the HSBC case as well as the Kohn suit.

In his written opinion on the UniCredit racketeering case, Rakoff said Picard made a “casual assertion” that the defendants “fed, perpetuated and profited from” Madoff’s Ponzi scheme, and failed to show a direct relationship between the alleged criminal acts and resulting injuries to the con man’s customers.

Common-Law Claims

Rakoff also dismissed common-law claims including unjust enrichment and conversion. He directed that the remaining claims be returned to bankruptcy court.

Marco Schnabl, a lawyer for UniCredit, declined to comment on the appeal. Picard said in his filing that he won’t appeal if Rakoff’s ruling in the racketeering case isn’t final yet.

UniCredit, based in Milan, and other defendants are trying to move the diminished Kohn and HSBC cases back to district court again, saying that Rakoff’s rulings in the Mets owners’ case raise new issues about how much profit and principal the trustee can claw back and what he is required to prove.

Madoff, 73, is serving a 150-year sentence in a federal prison in North Carolina for running a Ponzi scheme that defrauded investors of an estimated $20 billion in principal. Picard and his law firm, Baker & Hostetler LLP, have charged about $273 million for their work on the Madoff estate so far.

The case is Picard v. Kohn, 11-CV-1181, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporters on this story: Linda Sandler in New York at lsandler@bloomberg.net; Bob Van Voris in New York at rvanvoris@bloomberg.net

To contact the editors responsible for this story: John Pickering at jpickering@bloomberg.net; Michael Hytha at mhytha@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.