Irving H. Picard v. Saul B. Katz et al

Filing 153

DECLARATION of DANA M. SESHENS in Support re: 143 MOTION in Limine TO BAR USE OF PREJUDICIAL PHRASE., 145 MOTION in Limine TO EXCLUDE STERLING STAMOS DOCUMENTS.. Document filed by Charles 15 Associates, Charles 15 LLC, Charles Sterling LLC, Charles Sterling Sub LLC, College Place Enterprises LLC, Coney Island Baseball Holding Company LLC, Estate of Leonard Schreier, FFB Aviation LLC, FS Company LLC, Fred Wilpon Family Trust, Arthur Friedman, Ruth Friedman, Iris J. Katz and Saul B. Katz Family Foundation, Inc., Judy and Fred Wilpon Family Foundation, Inc., Amy Beth Katz, David Katz, Dayle Katz, Gregory Katz, Howard Katz, Iris Katz, 157 J.E.S. LLC, Air Sterling LLC, BAS Aircraft LLC, Jason Bacher, Bon Mick Family Partners LP, Bon-Mick, Inc., Brooklyn Baseball Company LLC, C.D.S. Corp., Michael Katz, Saul B. Katz, Todd Katz, Katz 2002 Descendants' Trust, Heather Katz Knopf, Natalie Katz O'Brien, Mets II LLC, Mets Limited Partnership, Mets One LLC, Mets Partners, Inc., Minor 1 (REDACTED), Minor 2 (REDACTED), L. Thomas Osterman, Phyllis Rebell Osterman, Realty Associates Madoff II, Red Valley Partners, Robbinsville Park LLC, Ruskin Garden Apartments LLC, Saul B. Katz Family Trust, Michael Schreier, Deyva Schreier Arthur, See Holdco LLC, See Holdings I, See Holdings II, Sterling 10 LLC, Sterling 15C LLC, Sterling 20 LLC, Sterling Acquisitions LLC, Sterling American Advisors II LP, Sterling American Property III LP, Sterling American Property IV LP, Sterling American Property V LP, Sterling Brunswick Corporation, Sterling Brunswick Seven LLC, Sterling Dist Properties LLC, Sterling Equities, Sterling Equities Associates, Sterling Equities Investors, Sterling Heritage LLC, Sterling Internal V LLC, Sterling Jet II Ltd., Sterling Jet Ltd., Sterling Mets Associates, Sterling Mets Associates II, Sterling Mets LP, Sterling Pathogenesis Company, Sterling Third Associates, Sterling Thirty Venture LLC, Sterling Tracing LLC, Sterling Twenty Five LLC, Sterling VC IV LLC, Sterling VC V LLC, Edward M. Tepper, Elise C. Tepper, Jacqueline G. Tepper, Marvin B. Tepper, Valley Harbor Associates, Kimberly Wachtler, Philip Wachtler, Bruce N. Wilpon, Daniel Wilpon, Debra Wilpon, Fred Wilpon, Jeffrey Wilpon, Jessica Wilpon, Judith Wilpon, Richard Wilpon, Scott Wilpon, Valerie Wilpon, Wilpon 2002 Descendants' Trust, Robin Wilpon Wachtler. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J, # 11 Exhibit K, # 12 Exhibit L, # 13 Exhibit M, # 14 Exhibit N, # 15 Exhibit O, # 16 Exhibit P)(Seshens, Dana)

EXHIBIT P

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C O N F I D E N T I A L

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UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
11-CV-03605(JSR)(HBP)

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IRVING H. PICARD, Trustee for
the Liquidation of Bernard L.
Madoff Investment Securities LLC,

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Videotaped
Deposition of:

Plaintiff,
v.

BRUCE G. DUBINSKY

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SAUL B. KATZ, et al.,

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Defendants.
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TRANSCRIPT of testimony as taken by and before

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NANCY MAHONEY, Certified Court Reporter, Registered

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Professional Reporter, and Notary Public of the

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States of New York and New Jersey, at the offices of

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Davis Polk & Wardwell, 450 Lexington Avenue

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New York, New York on January 11, 2012, commencing

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at 9:27 a.m.

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PICARD v. KATZ, et al.

CONFIDENTIAL

BRUCE G. DUBINSKY 1/11/12
81

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Now, let's get back into the whole
Ponzi scheme discussion --

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A.

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Q.

Sure.
-- which starts on the next page.

I

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think you discussed already your derivation of Ponzi

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scheme and illegitimate.

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the phrase "other peoples' money."

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A.

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Q.

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A.

Now I'd like to focus on

Sure.
Where did that phrase come from?
That was discussed -- thrown around

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with counsel as a term to describe the money that

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was coming from one investor, so there would be, I

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think, across the case a generic term that was being

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used.

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It's just, you know, a term that

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would describe in a Ponzi scheme, as I described to

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your earlier, if I'm the first investor in the door

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and my money's being paid back to number two, three

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or four, what are they getting?

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money.

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think, for consistency sake.

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I'm another person.

Q.

They're getting my

So just a term, I

I take it you don't mean to suggest

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by using that term that there's any kind of ability

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to trace actual cash through the accounts?

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A.

Oh, I see what you're saying.
BENDISH REPORTING, INC.
877.404.2193

No,

PICARD v. KATZ, et al.

CONFIDENTIAL

BRUCE G. DUBINSKY 1/11/12
82

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this cash was all co-mingled.

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account, the JPMorgan 703 account.

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well know, once cash is co-mingled, it's fungible

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and it's co-mingled and you cannot then go extra --

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you know, pull it apart and see -- you see where it

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came into the account, that you can do, but going

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back out, no, it becomes very difficult.

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Q.

There was one main
As you probably

And I take it you under -- I'm now

talking about the investment advisory business and
the period 1985 forward.

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I take it you understand that for

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many customers, customers would put in money, they

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would take out money, they would put in more money,

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they would take out money.

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one-shot affair, it was a constant inflow and

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outflow of cash based on apparent securities

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transactions.

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So this was not just a

Is that correct?
A.

There were instances of that.

There

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were also instances where I did see people just put

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money in and just let it build up and then

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eventually took some out at the end but -- before it

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collapsed.

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depiction, I guess.

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Q.

But that's a fair assumption, fair

And does that in any way change your
BENDISH REPORTING, INC.
877.404.2193

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