Macdonald | Fernandez LLP


221 Sansome Street
San Francisco, CA 94104
Telephone: (415) 362-0449
Facsimile: (415) 394-5544
914 Thirteenth Street
Modesto, CA 95354
Telephone: (209)549-7949
Facsimile: (209) 236-0172

Madoff Trustee Barred From Suing Big Banks

The US Court of Appeals for the Second Circuit has upheld a lower court ruling barring Irving Picard, the trustee supervising the dissolution of Bernard Madoff's Ponzi scheme in bankruptcy, from recovering almost $30 million from JP Morgan Chase and other banks he alleges aided Madoff's fraud.  The court sustained the banks' in pari delicto defense (Latin for "in equal fault"), holding that Picard stands in Madoff's shoes and two wrongdoers cannot sue each other for damages related to their conduct.  The court also commented that the victims may sue the banks, but there may be financial and procedural hurdles.