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The trustee representing defrauded clients of Bernard Madoff filed dozens of lawsuits Tuesday seeking to recover hundreds of millions of dollars, including an action against an affiliate of private equity executive Thomas H. Lee.
Irving Picard, the court-appointed trustee, filed 49 lawsuits by early afternoon at the U.S. bankruptcy court in Manhattan.
The filings are part of a series of so-called clawback lawsuits against investors who withdrew money from Bernard L. Madoff Investment Advisors LLC before the firm collapsed on Dec. 11, 2008.
Picard so far has recovered about $1.5 billion US for Madoff victims. He has initiated litigation aiming to recover more than $18 billion, including $2 billion from Swiss bank UBS AG and other sums from feeder funds that entrusted client money to Madoff, as well as from Madoff relatives including his wife Ruth.
The trustee must sue before the two-year anniversary of the demise of Madoff's firm. He is seeking sums withdrawn in the six prior years, a limitation imposed under New York law.
Madoff, 72, pleaded guilty in March 2009 to running what prosecutors called a $65-billion Ponzi scheme. He is serving a 150-year sentence at a federal prison in North Carolina.
Picard's lawsuit against Blue Star Investors LLC, the affiliate of Thomas H. Lee Partners, a Boston-based private equity firm in business since 1974, resembles many of the trustee's other clawback lawsuits.
According to the complaint, Blue Star received $51.75 million from Madoff's firm, of which $19.7 million represented “fictitious profits,” in that Blue Star withdrew more than it had invested. Lee received improper sums transferred from Blue Star and must repay them, the complaint said.
There was no immediate comment from Lee, who is among perhaps 1,000 “net winners” from Madoff’s operations that Picard has said he plans to sue.
Many of these investors insist that they too are victims, and say they should be compensated based on sums, even if false, shown on their final Madoff account statements. Some are appealing the rejection of this approach by U.S. Bankruptcy Judge Burton Lifland, who is overseeing the liquidation of Madoff's firm.