NEW YORK -- A trustee trying to recover money for investors in Bernard Madoff's Ponzi scheme was blocked Tuesday from immediately appealing a ruling limiting how much the New York Mets' owners might have to give up to other investors.
U.S. District Judge Jed Rakoff said letting trustee Irving Picard appeal his September ruling would delay a trial set for March 19 and slow a final resolution of the case. In the earlier ruling, the judge limited what the Mets' owners might have to pay to $386 million, depending on how much of what they received from Madoff was fictitious profits and how much was principal.
"Naturally, any party that loses an important interim ruling wants to appeal immediately, believing that a parade of horribles will follow if the district court's supposed error is not immediately corrected," the judge wrote. "But, as many state jurisdictions have learned to their detriment, the result of permitting interim appeals is vexatious and duplicative litigation, prolonged uncertainty and endless delay."
The judge added, in a nod to ex-Mets manager Yogi Berra, "Whether on the ballfield or in court, `it ain't over till it's over' is both shrewd observation and sound advice."
Picard was seeking $1 billion. He said the Mets' owners received $83.3 million in fictitious profits and $301 million in principal in the two years before Madoff's fraud was revealed in 2008. He accused them in court papers of ignoring warnings that Madoff's high returns might not be real.
Madoff revealed the fraud in December 2008, admitting that the more than $65 billion he had reported holding for thousands of investors had dwindled to only a few hundred million dollars. An investigation found Madoff never made any investments, instead using the money from new investors to pay returns to existing clients and finance a lavish lifestyle for his family. Losses have been estimated at around $20 billion, making it the biggest investment fraud in U.S. history.
Madoff pleaded guilty to fraud and is serving a 150-year prison term in Butner, N.C.
Picard, since his appointment, has tried to recover most of the roughly $20 billion that investors trusted with Madoff by limiting recoveries to initial investments and by trying to recover money from any investors who received profits from Madoff.
In September, the judge made it difficult for Picard to collect more than $83.3 million from the Mets' owners, saying he would have to prove that they knew about Madoff's fraud to recover any of the principal.
The dispute has jeopardized the Mets' financial condition, leaving the team searching for additional investors.
Mets co-owners Fred Wilpon and Saul Katz have said they did not know Madoff was engaged in fraud and that they received no warnings. They and their investment fund, Sterling Equities, say Picard has made "false allegations" and omitted evidence favorable to the owners to force a settlement.
Picard and his lawyers were aware of the ruling but had no immediate comment, trustee spokeswoman Amanda Remus said.