Rakoff Departs From Katz Ruling In $2B Madoff Fight

Law360, New York (February 14, 2013, 7:27 PM EST) -- The trustee liquidating Bernard Madoff's firm can use the Bankruptcy Code in his bid to dodge $2 billion in payouts to investment companies victimized in Madoff's fraud, a New York federal judge said Wednesday, departing from his ruling favoring former Madoff investor and Mets owner Saul Katz.

U.S. District Judge Jed Rakoff said that the Securities Investor Protection Act does not bar trustee Irving Picard from attempting to disallow investor claims under Section 502(d) of the Bankruptcy Code, departing from the 2011 Katz ruling, which held...
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