After years of bickering, a federal appeals court has ruled that victims of Bernard Madoff's massive Ponzi scheme are only entitled to recover the money they actually put into the fake investment fund—not the imagined profits. As Bloomberg News reports, "The federal appeals court in New York said today that trustee Irving Picard can calculate losses by subtracting the amount withdrawn from an investor’s account from the total placed with Madoff, the so-called net investment method."
Madoff's many victims had been fighting to get the whole value of their investment, as printed on the fake-investment statements, back (as one victim said in 2008, "The point with him was that I always got every document. If you get all the documents, you are not suspicious"). But Picard had argued victims shouldn't be expecting their 950% returns on investment. Chief U.S. Circuit Judge Dennis Jacobs wrote in the opinion, "Mr. Picard’s selection of the net investment method was more consistent with the statutory definition of ‘net equity’ than any other method advocated by the parties or perceived by this court."
Lawyers for victims said they would appeal the ruling and criticized it for ruining "investor confidence in the capital markets." Another likely unhappy party: Sterling Equities, the owner of the Mets, which would now have to pay back $300 million if the ruling stands.