Picard Lawsuit Seeks $1 billion Claiming Wilpons Ignored Warnings

As if this situation wasn't ridiculous enough, it gets even worse for the Mets owners being sued by Trustee, Irving Picard.

According to Adam Rubin, Picard's lawsuit, which led many to believe he was seeking $300 million, is actually seeking the $1 billion reported prior to the lawsuit being unsealed Friday.

In a statement, one of Picard's attorney's said:

“What the trustee is looking for here is a payment in cash...So whether they utilize the Mets, SNY, Sterling properties or any other resource is of no moment to us. What we’re looking for is a billion dollars, and unless we settle for less than that, which we’re not inclined to do, where they get the money is of no moment to us.”

As Rubin points out, the astronomical amount of money sought by Picard could just be a scare tactic to force the Wilpons to settle for less, perhaps for around $300 million, which is what Picard claims Sterling Partners, families, trustees, and entities withdrew from the Madoff accounts. 

Picard is seeking the extra millions because he claims the Wilpons either knew, or should have known about the Bernie Madoff Ponzi scheme, and continued to invest with the man while ignoring a number of warnings.

If the Wilpons decide to gamble and take this to trial, they could end up losing more than just $1 billion. It could mean the loss of the team as well.

Based on previous statements which came from the Mets, it does not sound like they are willing to settle. They genuinely seem as though they are being targeted, and they plan on fighting.

I've stated in the past that the Wilpons need to go. It's not a secret, I'm not a fan of them. If what they say is true, however, and they were not aware of the scheme, this lawsuit by Picard needs to end.

That being said, after reading the complaint again, it seems as though the Wilpons may have received and ignored warnings.

According to the complaint, following Madoff's arrest on December 11, 2008, a number of e-mails were sent which indicated the Chief Investment Officer for Sterling Stamos, Ashok Chachra, had been suspicious of Madoff for years. A Sterling Stamos sent the following in an e-mail:

"[A] lot of our investors gave us crap about not generating returns like Madoff's [...] and I guess our CIO always said it was a scam, 'too good to be true[.]'"

On December 13, 2008, the Sterling Stamos CIO sent an e-mail which also appears to confirm that the Wilpons knew something was up.

"In fact, we turned down the Madoff Funds more than [sic] 6 years ago and told many of our investors including the Wilpon and Katz families about our concerns. Notwithstanding our concerns, the Wilpon and Katz families continued to invest with Madoff Securities."

I Hear There's Some Baseball Happening Soon

All of this Mets/Madoff talk is giving me a headache. Let's take a moment to remember what we SHOULD be talking about.

That's right. Baseball. 10 more days...

Contents of Mets/Madoff Complaint Released

So on my lunch break, I decided to check out the 373 page court document, stating the details of the lawsuit brought against the Mets by Irving Picard. Why? Because what else would I do on my lunch break?

As I skimmed through the document, I have to be honest, I don't really know any more about this case than I did beforehand. The only new piece of information is that Picard is seeking $300 million. That's a heck of a lot better than the reported $1 billion.

I'm not even going to try and dissect this thing. I'll leave that to the experts. One thing I do know for sure, this is not going away any time soon.

As for whether the Wilpons would settle or go to trial, Adam Rubin tweeted this:

In a statement, Mets owners wrote:

"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...Again, we have done nothing wrong. We played by the rules. We abided by the court order not to discuss the lawsuit. Others did not. We are confident we will win in court."

Based on that statement, it doesn't sound like the Wilpons are going to go down without a fight.

WSJ Explains Mets/Madoff Debacle

Here is a brief video explaining what's happening with the Mets and their current situation. Video courtesy of Metsblog.



As I said in an earlier post, this situation is only going to get worse before it gets any better.

The New York Times reported today that the lawsuit by Irving Picard is not the only lawsuit filed against the Mets in regard to Madoff.

According to the article, Elyse S. Goldweber, a former employee at Sterling Equities Associates, filed a federal lawsuit which claims, "Wilpon and two other officers breached their fiduciary duties by offering employees the chance to invest their 401(k) plan with Madoff."

This is just getting ugly. After reading the article in the Times, I have to say, it sounds as though there were plenty of red flags when it came to Madoff, but as they say, hindsight is 20/20.

Tomorrow should be interesting with the unsealing of the trustee's complaint.

Stay tuned.

Mets Finally Asking For Input From Fans

The Mets are finally asking fans what they want. What they want to eat, that is.

Check out these two meals the Acela Club is offering:

• Fillet with blue cheese butter and crispy shallots, and;

• Lemon Braised Artichokes with veal stuffing, arugula and lemon confit.

What is this? What happened to a hot dog and a beer? This is not baseball food.

I don't know about you, but when I pay to go to a game, I want a hot dog, a beer, and my seat out there in the stands. It's all part of the ambiance. If I wanted to eat a fancy meal and watch everything on TV, I'd just stay home.

Suit Against Mets Could Go Public Friday

According to Adam Rubin, Mets ownership has withdrawn an objection to unseal the lawsuit brought against them by Irving Picard, the trustee representing the victims of the Bernie Madoff Ponzi scheme. The contents of the lawsuit could be made public as soon as tomorrow.

The Mets reportedly profited nearly $48 million from an investment with Madoff.

The Mets had sent a letter to Judge Burton Lifland of the U.S. Bankruptcy Court Southern District of Manhattan, asking that the contents of the lawsuit be sealed.

This comes after reports surfaced that the settlement negotiations between the two parties had stalled.

A court hearing is scheduled for February 9.

I have a feeling this is going to get a whole lot worse before it gets better.

Wilpons Need to Go, and They Need to Go Now

Courtesy: Newsday.com

Over the past few days, the news of the financial relationship between Bernie Madoff and the Wilpons has started to come out. The more I read about it, the more I believe the Wilpons are full of crap.

They've lied about about their money woes, and they've lied about how deeply involved Madoff was with the club's finances.

Since the Ponzi scheme was discovered in 2008, the Wilpons have offered little information as to what their relationship was with Madoff.

To me, it's simple. If you weren't close, you just say so. Make a clear statement. When you only share bits and pieces of information, and then sources begin to speak of  how deeply Madoff was involved with the team, well it's going to come back to bite you.

That's exactly what is happening to the Wilpons. Former employees are speaking out and saying that Madoff was a part of the team's business plan.

According to the New York Times:

"When the Mets negotiated their larger contracts with star players — complex deals with signing bonuses and performance incentives — they sometimes adopted the strategy of placing deferred money owed the players with Mr. Madoff’s investment firm. They would have to pay the player, but the owners of the club would be able to make money for themselves in the meantime... And when the costs of disability insurance spiked, the former employee recalled, the Mets began to self insure. They did it by investing premiums with Mr. Madoff."

People have been saying that the Wilpons were aware of the scheme by Madoff. Whether this is true, I have no idea. I would like to think it's false. I would hope, from a moral standpoint, the owners of the Mets would not be so stupid as to knowingly work with such a criminal.

If the relationship between the Wilpons and Madoff is as Irving Picard describes in his lawsuit against the Mets, I would like to think, from a financial standpoint, the Wilpons are not that dumb when it comes to business.

I am no financial expert, but when some one like Madoff has an 18 percent return on investments, and there is no explanation as to how he is making that happen, some kind of alarm should go off, especially  for someone with as much business experience as Fred Wilpon.

Whatever their relationship, whatever their involvement, the Wilpons time as owners of the Mets is almost up.

If you think this will not have an effect on the players, think again. Besides being hounded by the media (which you know will happen) and asked about the situation, they must also go through yet another season of instability.

The Mets finally went out and got a GM and manager that fans are excited about, and gave fans something to look forward to this season. Now this has to happen.

It's time for the Wilpons to cut the crap, and get out. Let the team, media, and fans get back to concentrating on what should be the main focus...baseball.