A U.S. District Judge ruled that Irving Picard, the bankruptcy trustee in charge of the Bernard Madoff
case, will not be permitted to block the $410 million Merkin settlement resolving New York state’s claims against Wall Street hedge fund manager Ezra Merkin, the man accused of secretly steering client money to Madoff.
Picard argued that a settlement would interfere with his rights to seek compensation for Madoff’s victims. In a court ruling in Manhattan, however, Judge Jed Rakoff ruled that the trustee, who sought to collect $500 million from Merkin for separate reasons, waited too long to intervene.
“The trustee, however, having for more than three years issued empty threats to seek a halt to the attorney general’s suit, has lost his right to complain,” Rakoff wrote, according to Bloomberg. “Even on the merits, moreover, his bluster proves to be without substance.”
Amanda Remus, a spokeswoman for Mr. Picard, said the trustee considered the decision “incorrect and contrary to law,” and would appeal the decision immediately, according to the New York Times.
The ongoing legal disputes
surrounding Madoff’s Ponzi scheme have been complicated by the sheer size and extent of the scheme and clashes between state law, bankruptcy law and civil law, Bloomberg analyzed.