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Lawsuit Demands Mets Owners Pay $300 Million in Madoff "Profits"

Ben Yakas

Published Feb 4, 2011

Modified Feb 4, 2011

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Ben Yakas

Published Feb 4, 2011

Modified Feb 4, 2011

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After settlement negotiations broke down yesterday between the owners of the Mets and the trustee who is suing them, alleging that their company was a “net winner” in Bernard Madoff’s Ponzi scheme, the details of the lawsuit have now been completely unsealed. Trustee Irving Picard, who is representing a group of Madoff victims, is suing the Wilpons company Sterling Equities (which controls the Mets) for at least $300 million, claiming that Madoff's "fictitious profits" fueled every part of the team's business, including "payroll, players' deferred compensation, and stadium operations." He also claims that the team ignored warnings by various financial experts about Madoff, including Merrill Lynch.

The Wilpons released a defiant statement today, claiming none of the their partners ever knew or suspected that Madoff ran a Ponzi scheme: "The Trustee's lawsuit is an outrageous "strong arm" effort to try to force a settlement by threatening to ruin our reputations and businesses which we have built for over 50 years. This is a flagrant abuse of the Trustee's authority and we will not succumb to his pressure. The conclusions in the complaint are not supported by the facts. While they may make for good headlines, they are abusive, unfair and untrue. We categorically reject them. We should not be made victims twice over - the first time by Madoff, and again by the Trustee's actions."

What has become clear is that even if none of them were aware of the scheme, team CEO Fred Wilpon and his family did have a close relationship with Madoff, one which may have led him astray in adopting some of his business practices. And while Wilpon said he was "confident we will win in court," his reputation has been very damaged by the allegations and the release of the formerly sealed complaint. One source told the Post he agreed with the Wilpons that Picard and the trustees are looking to force a big settlement, but it doesn't change the hard facts about the Mets financial future: "This will devolve into a full sale of the team," he predicted.

Tagged

baseball

Bernard Madoff

bernie madoff

fred wilpon

lawsuit

mets

mlb

wilpons

Ben Yakas

Ben Yakas is a former Gothamist reporter.

Gothamist is funded by sponsors and member donations

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