Bienert Katzman Littrell Williams LLP Partner Steven J. Katzman secured a global settlement agreement resolving all claims filed against the family members of Stanley Chais (“Chais”), an investment adviser who established and ran large feeder funds to Bernard L. Madoff’s (“Madoff”) investment firm, at a small fraction of claimed damages.

In December 2008, Madoff was arrested for criminal securities law violations, including securities fraud, investment advisor fraud, and mail and wire fraud.  Shortly thereafter, a trustee (“Trustee”) was appointed for the liquidation of the business of Benard L. Madoff Investment Securities LLC (“BLMIS”), then-pending in the United States Bankruptcy Court for the Southern District of New York.  Madoff pleaded guilty in March 2009, admitting that he operated a Ponzi scheme through the investment advisory side of BLMIS.  Months later, the Trustee filed an adversary proceeding against Steve’s clients. multiple Chais family members who were prominent attorneys in academia, government service, and entertainment. Thereafter, additional lawsuits – one filed by the California Attorney General and four actions filed by private investors – were filed against the Chais-related parties in California state courts.  In total, the lawsuits sought nearly $2 billion in damages. 

For over 4 years, the Trustee, California Attorney General, the plaintiffs in the California state court actions, and BKLW engaged in litigation and multiple mediation conferences.  Ultimately, Steve and the rest of the BKLW team negotiated a complex, global settlement agreement resolving all claims alleged against his clients for approximately $277 million. The settlement agreement was on favorable terms for BKLW’s clients with no findings of culpability, knowledge, or wrongdoing.

Read more:

• Madoff SIPA Trustee, California Attorney General, and Private Litigants Reach Recovery Agreement Valued in Excess of $277 Million with the Estate of Stanley Chais and Other Chais-Related Defendants, sipc.org.
• Madoff Figure’s $20M Deal With Calif., Investors, OK’d, Law360.
• BKLW wins summary disallowance of over $16 million in senior claims, bklwlaw.com.
• BKLW secures nearly $5 million for FDIC-R in ATIF reimbursement case in Florida, bklwlaw.com.