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

Filing 174

PROPOSED JOINT PRETRIAL CONSENT ORDER: Pursuant to Rule 4 of the Court's Individual Rules of Practice, Irving H. Picard, as trustee for the liquidation of the business of Bernard L. Madoff Investment Securities LLC under the Securities Investor Protection Act, 15 U.S.C. §§ 78aaa. et seq. and Bernard L. Madoff, by and through his counsel Baker & Hostetler LLP, and Defendants Saul B. Katz et al., by and through their counsel Davis Polk & Wardwell LLP, hereby submit their Proposed Joint Pretrial Consent Order as follows: The parties' joint statement of facts and other matters on which the parties agree is attached as Exhibit 1. The Trustee's remaining claims are listed herein. The Parties estimate that the trial will take approximately 10 business days; as further set forth in this Proposes Joint Pretrial Consent Order.(mro)

UNITED STATES DISTJUCT COURT
SOUTHERN DISTRICT OF NEW YORK
Adv. Pro. No. 08-01789 (BRL)

SIPA LIQUIDATIO"N

BERNARD L. MADOFF I:\TVESTMENT
SECURITIES LLC.

I (Substantively Consolidated)

Debtor,

-r-R-V-IN-O-H-.-P-IC-.-G\,-RD-,-T-ru-s-t-ee-f,-o-r-th-e-L-i-q-u-id-:-a-ti-on-o~f-il Adv. Pro. 1'\0. 10- 5287 (BRL)
Bernard L. lv! ad 0 ffInvestment Sceuri ti es LLC ,
I
Plaintiff.

v.

11-CV-03605 (JSR) (HBP)

SAUL B. KATZ, et aL
Defendants.

PROPOSED JOINT PRETRIAL CONSENT ORDER
Pursuant to Rule 4 of the Court's Individual Rules of Practice, Irving H. Picard (the
"Trustee"), as trustee for the liquidation of the business of Bernard L. ~ladoffInvcstmcnt

Securities LLC C'BL\lIS'} under t:le Securities Investor Protection Act, 15 U.S.c. §§ 78aaa.

el

seq. ("SIPA") and Bernard L. ivfadoff ("Madoff'), by and through his counsel Baker & Hostetler
LLP, and Defendants Saul B. Katz et al., by and through their counsel Davis Polk & Wardvvell
LLP, hereby submit their Proposed Joint Pretrial Consent Order as follows:
A.

A Stntement of the Facts and other Matters on which the Parties Agree

The patties' joint statement of facts and other matters
attached as Exhibit:.
B.

A Particularized

Dc~cription

0:1 vv~ich

the parties agree is

of Each Party's Remaining Claims

The Trustee's remaining claims are as follows:
Count One:

In Count One of his Second Amended Complaint, the Trustee seeks to

avoid and recover intentional fraudulent transfers (the "Transfers") made by BLMIS to the
following Defendants pursuant to sections 548(a)(1 )(A), 550(a) and 551 of the United States
Bankruptcy Code, 11 V.S.c. §§ 101 el seq. (the "Bankruptcy Code") and section 78fff-(2)(c)(3)
of SIPA:
Amy Beth Katz

Jeffrey Wilpon

Sterling 10 LLC

Arthur Friedman

Judith Wilpon

Sterling 15C LLC

Charles Sterling Sub LLC

Judy and Fred Wilpon Family

Sterling 20 LLC

Foundation, Inc.

Sterling Acquisitions LLC

College Place Enterprises

LtC

Katz 2002 Descendants' Trust

David Katz

L. Thomas Ostcnnan

Dayle Katz

Marvin B. Tepper

Sterling American Advisors II
LP
Sterling American Property V

LP
Debra Wilpon

Mets Limited Part..nership

Dcyva Schreier Arthur

Michael Katz

Sterling Brunswick Seven
LLC

Edward M. Tepper

Natalie Katz O'Brien

Sterling DIST Properties LLC

Elise C. Tepper

Philip Wachtler

Sterling Equities Associates

Estate of Leonard Schreier

Phyllis Rebell Osterman

Sterling Internal V LLC

FFB Aviation LLC

Red Valley Partners

Sterling 1vfets LP

Fred Wilpon

Richard Wiipon

Sterling Thirty Venture LLC

Fred Wilpon Family Trust

Robbinsville Park LtC

Sterlir,g Tracing LLC

FS Company LLC

Robir. Wilpon Wachtler

Sterling Twenty Five LLC

Gregory Katz

Ruth Friedman

Sterling VC IV LLC

Iris J. Katz and Saul B. Katz
Family Foundation, Inc.

Saul B. Katz

Sterling VC V LLC

Saul B. Katz Family Trust

Valerie \Vilpon

Ins Katz
SEE Holdeo LLC
Jacqueline G. Tepper

Wilpon 2002 Descendants'
Trust

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Specifically, the Trustee seeks to avoid and recover all transfers of customer property
made by BLMIS to the foregoing Defendanrs with the intent to hinder, delay or defraud its
creditors, including all transfers representing the return of "principal" totaling 2lpproximately
$303,399,001 predicated on Defenda.'1ts' willful blindness to fraudulent activity a1 BLMTS.:
Defendants dispute the Trustee's claims.
Count Nine:

In Count Nine of his Second Amended Comp1aint, the Trustee seeks the

recovery of the Transfers

sub5equen~ly

transferred by Defendants to the following defendants

totaling approximately $118,543,998 pursuant to section 550(a) of the Bankruptcy Code, and
section 78fff-2(c)(3) of SIPA:
Amy Beth Katz

Heather Katz Knopf

Red Valley Partners

Arthur Friedman

Howard Katz

Richard Wilpon

Daniel Wilpon

Iris J. Katz and Saul B. Katz
Family Foundation, Inc.

Robin Wilpon Wachtler

Ruth Friedman

Jeffrey Wilpon

Saul B. Katz

Edward M. Tepper

Jessica Wilpon

Saul B. Katz Family Trust

Elise C. Tepper

Katz 2002 Descendants' Trust

David Katz
Dayle Katz

Estate of Leonard Schreier

L Thomas Osterman

FFB Aviation LLC

Marvin B. Tepper

Fred Wilpon

:\1ichael Katz

Fred Wilpon Family Trust
Gregory Katz

:-.fatalic Katz O'Brien

Scott Wilpon
Todd KatZ
Valerie Wilpon
Wilpon 2002 Descendants'
Trust

Philip Wachtler

Defendants dispute the Trustee's claims.

By Order dated I'vfarch 5, 2012, this Court granted the Trustee's Partial Motion for Summary
Judgment on the basis set forth in the Order.
1

-3­

Count Eleven: In Count Eleven of his Second Amended Complaint the Trustee seeks to
equitably subordinate the SIP A claims filed by the following Defendants pursuant to section
510(c)(1) of the Bankruptcy Code:
Amy Beth Katz

Tris Katz

Saul B. Katz Family Trust

Arthur Friedman

Jacqueline G. Tepper

Seott Wilpon

Bon Mick Family Partners LP

Jeffrey Wilpon

SEE Haldeo LLC

Bruce Wilpon

Jessica \Vilpon

Sterling 10 L L C

Charles Sterling Sub LLC

Judith \Vilpon

Sterling 15C LLC

College Place Enterprises
LLC

Judy and Fred Wilpon Family
Foundation, Inc.

Sterling 20 LLC

Daniel \Vilpon

Katz 2002 Descendants' Trust
LLC

David Katz

L. Thomas Osterman

Sterling DIST Properties LLC

Dayle Katz

Marvin B. Tepper

Sterling Equities

Debra \\i'ilpon

Mets II LLC

Sterling Internal V LLC

Deyva Schreier Arthur

Mets Limited Partnership

Sterling Mets LP

Elise C. Tepper

i'vllchael Katz

Sterli!'lg Thirty Venture LLC

Estate of Leonard Schreier

Natalie Katz O'Bric:1

Sterling Tracing LLC

FFB Aviation Ltc

Philip \Vachtler

Sterling Twenty Five LLC

Fred Wilpon

Phyllis Rebell Ostem1an

Sterling VC IV LLC

Fred Wilpon Family Trust

Red Valley Partners

Sterling VC V LLC

FS Company LLC

Richard Wilpon

Todd Katz

Gregory Katz

Robbins'vme Park LLC

Valerie Wilpon

Heather Katz Knopf

Robin Wilpon Wachtler

Howard Katz

Ruth Friedman

\Vi]pon 2002 Descendants'
Trust

Iris J. Katz and Saul B. Katz
Family Foundation, lnc.

Saul B. Katz

Sterling Brunswick Seven

Specifically, the Trustee alleges that the foregoing Defendants have engaged in

inequit.1.ble conduct that has resulted in injury to the customers and creditors of BLMJS' estate
and has confened an unfair advantage on these Defendants. Based on these Defendants'

inequitable conduct the customers of BLMIS have been misled as to the true financial condition
of BLMIS, customers have been induced 10 invest \vithout knowledge of the actual facts
regarding BLMIS' financiai condition, and/or customers and creditors are less likely to recover
the full amounts duc 10 them because of the conduct of the Defendants.
Defendants dispute the Trustee's claims.

C.

Each Party's Specific Contentions as to the Facts that are in Dispute.

The Trust€ c 'S contentions are attached as Exhibit 2(A).

The Defendants' contentions are attached as Exhibit 2(B).

D.
A Particularized Statement of the Damages Claimed, including amounts, for

each Claim. Counterclaim, Cross-claim, or Third-party claim.

Fraudulent transfers in the amount ofS303J99~OOl.

Subsequent transfcrs of the fraudulent transfers in the amount of S 1 ] 8,543,998.
Prejudgment interest from the initiation of the adversary proceeding as to any fraudulent
transfer claims.

Defendants dispute these amounts,

E.
A List of the Names of the \Vitnesses (both fact witnesses and expert
witnesses) that Each Party Intends to Call~ in the Likely Order of Appearance.
The Trustee's witness list is attached as Exhibit 3(A).

The Defendants' witness list is attached as Exhibit 3(B).

F.
A List of All Exhibits to be Offered by Each Party. and Particularized
Objections thereto Noted in accordance with Fed. R. Civ. P. 26(a)(3}.
The Trustee's witness list is attached as Exhibit 4(A}.

The Defendants' \vitness list is attached as Exhibit 4(B).

G.

A Final Estimate of the Length of Trial.

The Parties estimate that the trial \\·ill take approximately 10 business days.

- 5­

Dated: March 12, 2012
New York, New York

BAKER & HOSTETLER LLP

DAVIS POLK & \VARD\VELL LLP

By: IslDavid J Sheehan
David J. Sheehan
Regina L. Griffin

Karen

Fernando A. Bohorquez
45 Rockefeller Plaza
New York. New York 10111
Telephone: [phone]
Facsimile: (212) 589-420 J

Dana :\>1. Seshens
450 Lexington Avenue
New York, New York J 0017
Telephone: [phone]
Facsimile: (212) 701-58000

Attorneys for Irving Ii Picard. TrUsTee for the

Attorneys for Defendants

By: Is! Robert F. lFise
Robert F. Wise

Substanth'ely Consolidated SIPA Liquidation
ofBernard L. lvfadofl1nvestment Securities
LLC al1d Bernard 1. AfadofJ

-6­

Wagner

Exhibit 1

Exhibit 1 to Pretrial CO,nsent Order

Picard P. Saul B. Katz. et al., ll-CV-0360S (JSR
Statement of Facts and Other Matters on which the Parties Agree'
1.

Sterling Equities is a general partnership founded in 1972 hy brothers-in-law Fred
Wilpon and Saul Katz.

2,

The general partners of Sterling Equities include Defendants Saul Katz, Fred Wilpon.
Michael Katz, Richard \Vilpon, David Katz, Thomas Osterman, Jeffrey Wilpon, Arthur
Friedman, Gregory Katz, Marvin B Tepper, and the Estate of Leonard B, Sc11reier
("Sterling Partners").

3.

The Sterling Partners and various related entities OVvl1 and operate a number of busincsses
and invest in asset classes that include real estate, professional baseball, sports media, and
private equity, These businesses involve, among other things, the purchase,
development, and management of commercial and residential reaJ estate, both directly
and througl1 the Sterling American Property ("SAP") funds, oVvl1ership of the New York
~,,1ets baseball franchise, a mc..jority ownership interest in SportsNet Nev,! York ("SNY"),
private equily and venture capital investments, and an ovvnership interest in the :fund of
funds Sterling Stamos Partners ("Sterling Stamos").

4.

The Sterling Partners acquired their first interest in the :\o1ets in 1980, In or around
August 2002, the Sterling Partners acquired fuII ownership of the Mets,

5,

Saul Katz currently serves as President and Chief Operating Officer of Sterling Equities

and as President of the New York r..-Iets and the Brooklyn Cyclones. Saul Katz is a CPA
He has responsibility for asset-based investments, is involved in strategic planning, and
sits on the Board of Directors of Sterling Stamos,

6.

Fred Wilpon currently serves as Chairman of the Board of Steriing Equities and as Chief
Executive Officer of the New York Mets and Chainnan of the Brooklyn Cyclones.

7.

Fred Wilpon is the brother of Richard Wilpon and the father of Jeffrey Wilpon.

8.

Richard \\.'ilpon joined Sterling Equities in or around 1972, became a partner shortly
thereafter, and currently servcs as a Senior Executive Vice President. He is primarily
involved in various real estate investments and is currently the Co-Chief Executive
Officer of SAP, where he mar.ages its investments and oversees its real estate
acquisitions and dispositions. He is also a Board member of the New York Mets,

9,

Jeffrey Wilponjoined Sterling Equities in or around 1986 and became a partner
thereafter. He currently serves as a Senior Executive Vice Presidem and as Chief
Operating Officer, Senior Executive Vice President, and Board member of the New York

: The Parties' agreement to the factual assertions set forth herein should not be construed
as an agreement by the Parties that all such facts are relevant or materiaL

Mets. He is the Senior Executive Vice President and Chief Operating Officer of the
Brooklyn Cyclones and is primarily responsible for overseeing the day-to-day baseball
and business operations of the New York Mets.

10.

Miehae I Katz is the brother of Saul Katz and the father of Gregory Katz,

11.

Michael Katz joined Sterling Equities in or around J 973 and became a partner shortly
thereafter. He is a. CPA. He currently serves as a Senior Executive Vice President and,
up until 200 I, was Chief Financial Officer. He is primarily involved in various real
estate investments and is currently the Co-Chief Executive Officer of SAP where he is
responsible for the day-to-day management of its real estate investments. He is also a
Board member of the ~ew York Mets.

12.

Gregory Katz joined Sterling Equities in 2001 and became a partner thereafter. He
currently serves as a Vice President and focuses on real estate investments where he
acquires multi-family, corr:tr;1crcial and retail real estate propcrties and arranges financing
for SAP.

13.

David Katz is the son of SauJ Katz.

14.

David Katz joined Sterling Equities in 1987 and became a partner ~hereafter. He
currently serves as an Executive Vice President and is a Board member of the New York
Mets. He holds responsibilities with respect to various real estate and private equity
investments, and previously served as a boa.rd member of Sterling Stamos.

15.

Arthur Friedman is a CPA and holds a law degree. He joined Sterling Equities in or
around 1986 and became a partner shortly thereafter. He currently serve.'!; as a Senior
Vice President and is a Board member of the Mets.

16.

Thomas Osterman joined Sterling Equities in or around 1975 and became a partner
thereafter. He currently serves as an Executive Vice President and is responsible for
overseeing the development of commercial and residential properties in I\'lanhanan, as
well as for the strategic management of SAP's real estate assets. He is also a Board
member of the Nev\!' York Mets.

17.

Marvin Tepper joined Sterling Equities in or around 1990 as general counsel and partner
after having served as outside counsel. He retired in or around 2005. FIe is a member of
the Board of Directors ofthe Mets, He holds a law degree and has over 30 years of
private practice experience.

18.

Leonard Schreier was a Sterling Partner until his death in 2001. After his death, his
partnership interests in Sterling Equities and related entities and investments were held
and maintained by the Estate of Leonard Schreier, of which Fred Wilpon and Jason
Bacher are co-executors.

19.

Leonard Schreier died on October 28,2001. Leonard Schreier's surviving children,
Deyva Schreier Arthur and Michael Andrew Schreier, were the sole beneficiaries of his
estate.
2

20.

Bernard L. :\1adoffTnvestment Securities LLC C'BLMIS") was founded in 1959 by
Bernard L. Madoff ("Madofe). Since approximately 1987, BLMIS operated from its
principal place of business at 885 Third Aveoue, New York, New York. This building is
commonly known as "The Lipstick Building."

2].

As of January 19, 1960, i\bdoffregistered BU"nS with the Securities and Exchange
Commission (,"SEC") as a securities broker-dealer under Section; 5(b) of the Securities
Exchange Act of 1934, SIPA § 780(b).

22.

BLMIS remained a registered broker-dealer as of December 11, 2008.

23.

By virtue of that registration, BL~vrrS was a member of the Securities Investor Protection
Corporati on ("S IPe") ,

24.

In 1983, BLMIS registered Madoff Holdings Limited in London, ""hich began operating
as Madoff Securities btemational Limited ("MSIL") in ; 988.

25.

BLMTS was engaged in three businesses:
proprietary trading.

26.

Madoff registered himself and BLMIS \vith the SEC as a Registered Investment Advisor
in August 2006.

27.

Madoffserved as vice-chainnan of the National Association of Securities Dealers
CNASD") and as a member of its board of governors,

28.

On December 11, 2008. !vladoff was arrested and charged with securities fraud,
investment advisor fraud, mail fraud, vvire fraud, international money laundering to
promote fraud in the sales of securities, international money laundering the conceal the
proceedings of fTaud in the sale of securities, money laundering, making false statements.
perjury, rr.aking a false filing \vith the SEC, and theft from an employee benefit plan.

29,

Madoff engaged in a fraudu;ent scheme in which he purported to execute, but did not
actually execute, securities transactions on behalf of BLMIS customers.

30.

Madoffpleaded gUilty to the eleven-count infonnation, v,'hich alleged- and he
admitt~d-that he operuted a fraudulent scheme through the IA Business of BLMIS.

31.

Madoff admitted that BLMIS did not engage in the split-strike conversion securities
trades reported on customer statements between the early 1990s and 2008.

32.

Instead, rvfadoff deposited funds provided to BLMIS by its customers for investment
purposes into a bank account numbered xxx-xxx703 at Chase Manhattan Bank.

33.

Madoff perpetuated his fraud by creating fictitious documents, including, but not limited
to. false BLMJS customer statements th::lt reflected transactions that were never executed,

3

investm~nt

advisory, mar;cet making, and

34.

At least five individuals have pleaded guilty to criminal charges in connection ',.\;ith the
fraud perpetrated by iv'fadoffthrough BLMIS.

35.

BLMJS used Friehling & Horowitz as its accountant.

36.

David Friehling of Frieh]ing & Horowitz pleaded guilty to several federal fraud charges
for his involvement with Madoff s fraud.

37.

On December 11, 2008, the SEC filed a complaint in the District Court that commenced
proceedings against Madoff and BLMJS.

38.

On December 15, 2008. the SEC consented to a combination of its own action with an
application of SIPC. Thereafter. SIPC filed an application in the civil action seeking a
decree that the customers of BLMIS are in need of the protections afforded by the
Securities Investors Protection Act ("SIPA"). The District Court granted SIPC's
applica~jon and issued a protective order appointing Irving H. Picard, Esq., as Trustee for
the liquidation of the business ofBLMIS.

39.

Fred Wilpon met .!v1adoff through their children, who attended school together on Long
Island.

40.

From the time he joined Sterling Equities through December 11, 2008, i\rthur Friedman

provided administrative assistance to account holders with respect to the majority of
1KW BLMIS accounts. Among other things, he communicated deposit and withdrawal
requests from lKW BUvHS customers to BLMIS, oflen by Jetter, maintained paperwork,
including regularly issued monthly account statements, and monitored account balances.
41.

Arthur Friedman generally was responsible for reporting on BLMIS' performance at bi­
weekly meetings of the Ster]ing Partners.

42,

For purposes of Defendants' respective BLMIS accounts at issue in this litigation, each
typically recejved BLMIS correspondence care of Sterling Equities, 111 Great Neck
Road, Suite 408, Great 0Teck, ~ew York 11021.

43.

Defendants regularly received monthly statements, trade confim1ations, and quarterly
reports f-rom BLMTS.

44.

BLJ\.HS account statements purported to reflect transactions and investment returns in
each Defendant's account.

45.

BLMTS provided tax-related information for the 1KW BL:rvnS accounts,

46.

The following entity Defendants in the New York Mets o',.\;llcrship chain were BLMIS
customers: Sterling Mets LP, Mets Limited Partnership, and Mets IT LLC.

47.

Revenues generated by Mrts operations typically were dcpOBit€:d into Mets-related
BLMIS accounts \/."hen they were earned, often before the st<l.rt of the baseball season,

4

and then were \vithdrawn during the course of the baseball season as needed to meet
expenses.
48.

Defendant Sterling Mets LP and Defendant ivfets Limited Partnership are heJd by
intermediate LLCs and partnerships that arc ultimately o~ned by the Sterling Partners.

49.

Mcts Limited Partnership is a limited partnership formed under the lav·iS of the state of
Delaware and its principaJ place of business is located at 1 J J Great Neck Road, Suite
408, Great Neck, New Yark 11021.

50.

At all relevant times, the limited partners of Mets Limited Pa.rtnership were Mets One
LLC and Defendant Mets II LLC, both Delaware limited liability companies.

51.

Mets II LLC is a limited Jiability company formed under the laws of the S'k"lte of
Dela\vare and its principal place of business is located at t II Great Neck Road, Suite
408, Great N eclc N e'vv York 11021.

52.

The sole member ofMets II LLC is Sterling rv'fets Associates II. a New York general
partnership. The panners of Sterling tvIets Associates are Fred \\,rilpon, Saul Katz,
Jeffrey \Vilpon, David Katz, Thomas Osterman, Marvin Tepper, Arthur Friedman, the
Fred Wilpon Family Trust, the Saul B. Katz Family Trust, the Wilpon 2002 Descendants'
Trust, the Katz 2002 Descendants' Trust. and the L Thomas Osterman Family Trust.

53.

The sole general partner of Sterling Mets LP is Mets Partners, Inc., a New York
corporation whose sale shareholder is Fred \Vilpon and whose officers andlor directors
include Fred \Viipon. among others.

54.

The sole limited partner of Sterling Mets LP is Mets Limited Partnership.

55.

The sale member of FS Company LLC is Sterling Heritage LLC.

56.

FS Company LLC is a limited liability compa..'l}' fanned under the laws of the state of
New York and its principal place of business is located at 111 Great Neck Road, Suite
408, Great Neck. Ne\v York 11021.

57.

Defendant Charles Sterling Sub LLC is a limited liability company forrned under the
laws of the state of New York and its principal place of business is located at 111 Great
Neck Road, Suite 408, Great Neck, 'l\"ew York 11 021.

58.

The sole member of Charles Sterling Sub LLC is Charles Sterling LLC.

59.

Defendant College Place Enterprises LLC is a limited liability company formed under the
laws of the state of Nc\\' York and its principal place of business i$ located at 111 Great
Neck Road. Suite 408, Great Neck, ~ew York 11021.

60.

The members of College Place Enterprises LtC include Fred \Vilpon and Saul Katz.

n

5

61.

Defendant FFB Aviation LLC is a limited liability company formed under the laws of the
state of New York and its principal place of business is located at III Great Neck Road,
Suite 408, Great Neck, New York 11021.

62.

The members and managers ofFFB Aviation LtC include Saul Katz and Michael Katz,
among others \vho arc not named as defendants herein.

63.

Defe.ndant Iris 1. Katz and Saul B. Katz Family Foundation, Inc. (the "Iris J. Katz and
Saul B. Katz Family Foundation") is a corporation formed under the laws of the state of
Delaware. Saul Katz is the President and a director of the Iris 1. Katz and Saul B. Katz
Family Foundation. Iris 1. Katz and David Katz are also directors of the Iris J. Katz and
Saul B. Katz Fa..'l1i1y Foundation.

64.

Defendant Judy and Fred Wil?on Family Foundation, Inc, (the -"Judy and Fred Wilpon
Family Foundation") is a corporation formed under the laws of the state of Delaware.
The directors of the Judy and Fred Wilpon Family Foundation are Fred Wilpon, Judith
WilpolJ, Jeffrey \Vilpon, Robin Wilpon Wachtler. and Bruce N. \x/jlpon,

65.

Defendant Red Valley Partners is a general partnership formed under the laws of the state
of New York and its principal place of business is located at 111 Great Neck Road, Suite
408, Great Neck New York 11021.

66.

The general partners of Red Valley Partners are David Katz, Heather Katz Knopf, and
Natalie Katz O'Brien.

67.

Defendant Robbinsville Park LLC is a limited liability company fonned underthe laws
of the state of New York. Its principal place of business is located at 111 Great Neck
Road, Suite 408, Great Neck. Ne\v York 11021. Its registered agent for service of
process is Sterling Equities, 111 Grcat Neck Road, Suite 408, Great Neck, New York
11021.

68.

The member.s of Robbinsville Park LLC are Sterling Rte 130 LtC and SC Acquisition
Corp. The managers of Robbinsville Park LLC are Saul Katz, Richard Wilpon, Michael
Katz, and Fred Wilpon.

69.

Defendant Sterling Rte 130 LLC is a New York limited liability company whose
members are the Fred Wilpon Family Trust, Saul Katz, the Saul B. KatJ.: Family Trust,
Richard Wilpon, ~vfichae1 Katz, the Estate of Leonard Schreier, Marvin Tepper, Thomas
Osterman, Arthur Friedman, Jeffrey Wilpon, David Katz, and Robin and Philip Wachtler
as joint tenants.

70.

Defendant SEE Boldeo LLC is a limited liability company formed under the laws of the
state of Delaware and its principal place of business is located at 111 Great Neck Road,
Suite 408, Great Neck. New York: 1021.

71.

The members of SEE Holdeo LLC include SEE Management lLC, SEE Holdings J, and
SEE Holdings rT. SEE Management LLC is the managing member of SEE Holdeo LLC.

6

72.

Defendant SEE Management LLC is a Delaware limited liability company whose
members and managers are Fred Wilpon and Saul Katz.

73.

Certain entity KW BLMTS accounts were opened by limited liability companies in \vhich
one or more of the Sterling Partners held an interest

74.

Defendant Sterling 10 LLC is a limited liability company fonned under the laws of the
state of New York and its principal plaee of business is located at 111 Great Neck Road,
Suite 408, Great Neck, New York 11021.

75.

The members of Sterling 10 LLC include Richard Wilpon, Robin & Philip Wachtler as
joint tenants, Robin Wilpon Wachtler, the Scott Wilpon 2000 Trust, tb.c Jessica Wilpon
2000 Trust, Daniel Wilpon, David Katz, Michael Katz, Gregory Katz, Natalie Katz
O'Brien, Todd Katz, Daniel and Heather Katz Knopf, Howard Katz, Amy Beth Katz,
Dayle Katz, the Dayle & Michael Katz Foundation, Ruth Friedman, Elise C. Tepper, and
the Tepper Family Foundation, among others not named a.s defendants herein.

76.

The managing members of Sterling 10 LLC arc Richard Wilpon, Michael Katz, Arthur
Friedman, and David Katz.

77.

Defendant Sterling 15C LLC is a limited liability company f0n11ed under the laws of the
state of New York and its principal place of business is located at III Great Neck Road,
Suite 408, Great Neck, New York 11021.

78.

The members of Sterling I 5C LLC are Saul Katz, Richard Wilpon, Fred Wilpon, Michael
Katz, the Estate of Leonard Schreier, Thomas Osterman, JeffTey \Vilpon, David Katz,
Arthur Friedman, the Saul B. Katz Family Trust, the Fred Wilpon Family Trust, Marvin
Tepper, and Robin and Philip Wachtler as joint tenants.

79.

Defendant Sterling 20 LLC is a limited liability company formed under the laws of the
state of ~e"v York and its principaJ place of business is located at J 11 Grea.t Neck Road,
Suite 408, Great N eck, New York 11021 .

80.

The members of Sterling 20 LLC include Fred Wilpon, Saul Katz, Richard Wilpon,
Michael Katz, Thomas Osterman, Arthur Friedman, Jeffrey Wilpon, Marvin Tepper,
Elise C. Tepper, David Katz, and the Fred Wilpon Family Trust.

81.

Fred Wilpon, Saul Katz, Richard Wilpon, and Michael Katz are among the managing
members of Sterling 20 LLC.

82.

Defendant Sterling American Advisors IT LP is a limited partnership formed under the
laws of the sta.te of Delaware and its principal place of business is located at 111 Great
Neck Road, Suite 408, Great Neck, New York 11021

83.

The partners of Sterling American Advisors II LP include Sterling R. I. II LLC and
Sterling Internal n LLC, among others not listed as defendants in this action.

7

84.

Defendant Sterling R.T. II LLC is a New York limited liability company whose members
include Arthur Friedman, David Katz, Fred Wilpon, Jeffrey Wilpon, Thomas Osterman,
Marvin Tepper, Mjcha.el Katz, Richard Wilpon, and Saul Katz, among others not listed as

defendants herein.
85.

Leonard Schreier was a member of Sterling Internal II LLC.

86.

Defendant Sterling Brunswick Seven LLC is a limited liability company formed under
the la\vs of the state of New York and its principal pJace of business is located at II I
Great Neck Road. Suite 408. Great Neck, New York 11021.

87.

The sole member of Sterling Brunswick Seven LLC is Sterling Brunswick Corporation.

88.

The managers of Sterling Bruns\vick Seven LLC are Richard Wilpon and J\·fichael Katz.

89.

Defendant Sterling DTST Properties LLC is a limited liability company fonned under the
Jaws of the state of Delaware and its principal place of business is located at III Great
Neck Road, Suite 408, Great Neck, New York 11021.

90,

The members of Sterling DTST Properties LLC include Fred Wilpon, the Wilpon 2002
Descendants' Trust, Jeffrey Wilpon, Richard Wilpon, Saul Katz, the Saul B. Katz Family
Trust, ~he Kat: 2002 Descendants' Trust, David Katz, Gregory Katz, Anhur Friedman,
Marvin Tepper, and Thomas Osterman. among others.

91.

The managers of Sterling DIST Properties LtC are Michael Katz, Arthur Friedman, and
Richard Wilpon..

92.

Defendant Sterling Heritage LLC is a limited liability company formed under the laws of
the state of New York and its principal place of business is located at 111 Great Neck
Road, Suite 408, Great 1':eck. New York 11021.

93.

TI1e members of Sterling Heritage LLC are Fred Wilpon, Saul Katz. Richard A. Wilpon,
Michael Katz, Estate of Leonard Schreier, Thomas Osterman, Arthur Friedman, Jeffrey
Wilpon, David Katz, and \1an1in Tepper.

94.

The managing members of Sterling Heritage LLC are Fred Wilpon, Richard Wilpon, Saul
Katz, l'vfichael Katz. and Arthur Friedman.

95.

Defendant Sterling Internal V LLC is a limited liability company formed under the laws
of the state of Ddaware and its principal place of business is located at 111 Great Neck
Road, Suite 408, Great Neck, New York 11021.

96.

The members of Sterling Internal V LLC include Fred Wilpon, the Fred Wilpon Family
Trust the Wilpon 2002 Descendants' Trust, Jeffrey Wilpon, Richard Wilpon, Saul Katz,
the Saul B. Katz Family Trust, the Katz 2002 Descendants' Trust ~1ichael Katz, Gregory
Katz, Arthur Friedman. I"viarvin Tepper. and Thomas Ostennan, among others not named
as defendants herein.

8

97.

Defendant Sterling Thirty Venture LtC is a limited liability company fom1ed under the
laws of the state of New York and its principal place of business is located at 111 Great
Neck Road, S'Jite 408, Great Neck, New York 11021.

98.

The managing members of Sterling Thirty Venture LLC are Fred \Vi;pon. Saul Katz,
Richard Wilpon, Michael Katz, Arthur Friedman. and David Kat?,.

99.

The members of Sterling Thirty Venture LLC are Fred Wilpon, Saul Katz, Richard
Wilpon, l\'fichael Katz, Arthur Friedman, David Katz, the Estate of Leonard Schreier,
Thomas Osterman, Jeffrey Wilpon, Valerie Wilpon, Marvin Tepper, Gregory Katz, Todd
Katz, Howard Katz, Dayle Katz, and Red Valley Partners. Elise C. Tepper is a former
member of Sterling Thirty Venture LCe.

100. Defendant Red Valley Partners is a New York general partnership whose partners are
David Katz, Heather Katz Knopf and Natalie Katz O'Brien.
101. Defendant Sterling Tracing LLC is a limited liability company formed under the laws of
the state of New York and its principal place of business is ioeated at III Great 'Neck
Road, Suite 408, Great Neck, Nev-,: York] 1021.
102. The members of Sterling Tracing LLC are Michael Katz, Richard Wilpon, Gregory Katz,
Scott \ViJpon. Jeffrey \Vilpon, Thomas Osterman and Arthur and Ruth Friedman as joint
tenants.
103. Defendant Sterling Twenty Five LLC is a Umited liability company fonned under the
la\\1S of the state of New York and its principal place of business is located at 111 Great
Neck Road, Suite 408, Great Neck, New York 1102 L
104. The members of Sterling Twenty Five LLC include FFB Aviation LLC, Michael Katz,
J-Toward Katz, Arthur and Ruth Freidman as joint tenants, the Dayle H. and Michael Katz
Foundation. the Katz 2002 Descendants' Trust, the Wilpon 2002 Descendants' Trust,
Dayle Katz. the Thomas Osterman 1999 Trust, the Thomas Osterman Family 2006
Guarantor Trust, Richard Wilpon, Marvin Tepper, Robin and Phillip Wachtler as joint
tenants, Gregory and Amy Beth Katz as joint tenants, Todd Katz, the Jessica Wilpon
2000 Trust the Scott Wilpon 2000 Trust and Daniel Wilpon.
105. Defendant Sterling VC IV LLC is a limited liability company formed under the la\vs of
the state of New York and its principal place of business is located at 111 Great Neck
Road, Suite 408, Great Neck, Nevv' York 11021.
106. The members of Sterling VC IV LLC include Fred Wilpon, the Fred Wilpon Family
Trust, Jeffrey Wilpon, Richard Wilpon, Saul Katz, the Saul B. Katz Family Trust, the
Katz 2002 Descendants' Trust, David Katz, Michael Katz, Gregory Katz, the Iris & Saul
8. Katz Family Foundation, Arthur Friedman, l\farvin Tepper, and Thomas Osterman,
among others not named as defendants herein.
107. Defendant Sterling VC V LtC is a limited liability company formed under the la'vvs of
the state of New York and its princip<11 place of business is located at 1 J 1 Great Neck
9

Road, Suite 408, Great :Neck New York 11021 and it accepts service of process courtesy
of Sterling Equities at 111 Great Neck Road, Suite 408, Great Neck, New York 11021.
108. The members of Sterling VC V LLC include Fred Wilpon, the Fred Wilpon Family Trust,
the Wilpon 2002 Descendants' Trust, Jeffrey Wilpon, Riehard Wilpon, Scott Wilpon,
Saul Katz, the Saul B. Katz Family Trust, the Katz 2002 Descendants' Trust, David Katz,
Michael Katz, Gregory Katz, Arthur Friedman, Marvin Tepper, and Thomas Osterman,
among others not named as defendants herein.
109. The managers of Sterli!'lg VC V LLC are Michael Katz, Arthur Friedman, and Richard

Wilpon.
1] O.

Madoff im'ested in certain Sterling-related real estate deals and business ventures. Each
such investment was held in Ruth Madoff s name and any dealings concerning those
investments were v.;th Madoff.

111. Investments by Madoff were made in the name of Ruth Madoff in Sterling Acquisitions
and SAPV.
112. Defendant Sterling Acquisitions LLC is a general partnership formed under the laws of
the state of New York and its principal place of business is located at III Great Neck
Road, Suite 408, Great Neck, New York 11021.
113. The members of Sterling Acquisitions LLC include Ruth Madoff, the Saul B. Katz
Family Trust, Fred Wilpon, Richard Wilpon, Michael Katz, Arthur Friedman, Marvin
Tepper, Saul Katz, the Fred Wilpon Family Trust, Gregory Katz, Howard Katz, Todd
Katz, the Thomas Osterman 1999 Trust Jeffrey Wilpon, David Katz, Jacqueline G.
Tepper, Edward M. Tepper. Heather Katz Knopf, J\atalie Katz O'Brien, Thomas
Ostennan, Scott Wilpon, Jessica Wilpon, Daniei Wilpon, the Iris J. and Saul B. Katz
Family Foundation, and the Estate of Leonard Schreier, and Heather Katz Knopf and Dan
Knopf are members as tcnarJs-in-common, among others not listed as defendants herein.
114. Defendant Sterling American Prapeny V LP is a limited partnership fanned under the
laws of the state of Delaware and its principal place of business is located at 1 t 1 Great
Neck Road, Suite 408, Great Neck, New York 11021.
115. The limited partners of Steriing American Property V LP include Ruth Madoff and Peter
Madoff, among others not listed as defer,dants herein. The general partner of Sterling
American Property V LP is Sterling American Advisors V LLC.
116. Ddendant Saul B. Katz Family Trust is a trust formed under the laws of the state of New
York. The settlor of the Saul B. KatZ Fami;y Trust is Saul Katz and the trustees of the
Saul B. Katz Family Trust are Michael Katz, Richard \VUpon. Iris Katz, David Katz,
Natalie Katz O'Brien and Heather Katz Knopf The former trustee of the Saul B. Katz
Family Trust is Fred Wilpon. The Saul B. Katz Family Trust, trustees and former trustee
are collectively referred to herein as the "Saul B. Katz Family Trust." The beneficiaries
of the Saul B. Katz Family Trust include David Katz, Natalie Katz O'Brien and I-leather
Katz Knopf.
10

117.

Saul B. Katz Fami~y Trust held interests in different BLMIS accounts.

118.

Defendant Fred \~iilpon Family Trust is a trust formed 1.L1"lder the Ia-ws of the state of New
York. The settlor of the Fred Wilpon Family Trust is Fred Wilpon and the trustees of the
Fred Wilpon Family Trust are Judith \Vilpon, Debra Wilpon and Richard Wilpon. The
formcrtrustees of the Fred Wilpon Family Trust are Saul Katz. Michael Katz. and
Marvin Tepper. Thc beneficiaries of the Fred \Vilpon Family Trust include Jeffrey
Wilpon and Robin Wilpon Wachtler.

119.

The Fred Wilpon Family Trust held interests in different BLMIS accOlmts.

120.

Defendant Katz 2002 Descendants' Trust is a trust formed under the laws of the state of
New York. The settlor of the Katz 2002 Descendants' Trust is Michael Katz and the
trustees of the Katz 2002 Dcscenda.'1ts' Trust are Saul Katz and Dayle Katz. The
beneficiaries of the Katz 2002 Descendants' Tnm include Dayle Katz, Gregory Katz,
Howard Katz and Todd Katz.

121.

The Katz 2002 Descendants' Trust held interests in different BL l'vHS accounts.

122.

Defendant Wilpon 2002 Descendants' Trust is a trust fonned under the laws of the state
of Ne\\" York. The settlor of the \Vilpon 2002 Descendants' Trust is Richard Wilpon and
the trustees of the Wilpon 2002 Descendants' Trust are Fred Wilpon and Debra Wilpon.
The be:1cficiaries of the Wilpon 2002 Descendants' Trust are Jessica Wilpon, Daniel
Wilpon. Debra Wilpon, ar.d Scott Wilpon.

123.

The v,,'ilpon 2002 Descendants' Trust held interests in different BLMIS accounts.

124.

Defendant Iris Katl maintains her residence in Glen Cove, New York and, for purposes
of the Sterling BLMIS Accounts at issue, received correspondence at Sterling Equities.
III Great Neck Road, Suite 408, Great Neck, New York 11021.

125.

Iris Katz is the wifc of Saul Katz.

126.

Iris Katz held interests in ditIerent BLMIS accounts.

127.

Iris Katz is n~'11ed as a Defendant in this action in her individual capacity, and as trustee
of the Saul R Katz Family Trust.

128.

Defendant Judith \Vilpon maintains her residence in Locust Valley, New York and, for
purposes of the Sterling BLMIS Accounts at issue, received co:-respondence at Sterling
Equities, III Great Neck Road, Suite 40&, Great Neck, Nev..: York 11021.

129.

Judith Wilpon is the wife of Fred Wilpon.

130.

Judith Wilpon held interests in different BL\lIS accounts.

11

131. Judith Wilpon is named as a Defendant in this action in her individual capacity, as trustee
of the Fred Wilpon Family Trust, and as tcnani-in-common in the accounts identified in
Section XII of the Amended Complaint.
132. Defendant Dayle Katz maintains her residence in Old Vlestbury, New York and, for
purposes of the Sterling BLMTS Accounts a1 issue, received correspondence at Sterling
Equities, 111 Great Neck Road, Suite 408, Great Neck, New York 11021.
133. Defendant Dayle Katz is the wife of Miclmel Katz.
134. Dayle Katz held interests in different BLMTS accounts.
135. Daylc Katz is named as a Defendant in this action in her individual capacity, as trustee of
the Katz 2002 Descendants' Trust, as beneficiary of the Katz 2002 Descendants' Trust,
and as joint tenant in the accounts identified in Section XII of the Amended Complaint.
136. Defendant Debra Wilpon, for purposes of the Sterling BLMIS Accounts at issue, received
correspondence at Sterling Equities, III Great Neck Road, Suite 408, Great Neck, New
York 11021.
137, Debra \Vilpon is the wife of Richard Wilpon.
138. Debra Wilpon held interests in different BLMIS accounts.
139. Debra Wilpon is named as a Defendant in this action in her individual capacity, as trustee
of the Fred Wilpon Family Trust and the Wilpon 2002 Descendants' Trust, as joint
tenant, and as tenant-in-common in the accounts identified in Section XIT of the
Amended Complaint.

140. Defendant Valerie Wilpon maintains her residence in Greenwich, Connecticut and, for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equities, J 11 Great Neck Road, Suite 408, Great Neck, Ne\v York 11021.
141. Defendant Valerie \Vilpon is the wife ofJeffrey Wilpon.
142. Valerie Wilpon held interests in different BUvlIS accounts.
143. Valerie Wilpon is named as a Defendant in this action in her individual capacity and as
joint tenant in the accounts identified in Section XII of the Amended Complaint.
144. Bruce N. Wilpon maintains his residence in Kew York, Ne",' York and, for purposes of
the Sterling BU.,lIS Accounts at issue, received corresponder.ce at Sterling Equities, III
Great Neck Road, Suite 408, Great Neck, Nc\v York 11021.
145. Bruce N. Wi lpon is the son of Fred Wilpon.
146. Bruce X Wilpon held interests in different

12

BLMIS accounts.

147. Defendant Amy Beth Katz maintains her residence in Syosset, New York and, for
purposes of the Ster:ing BL\US Accounts at issue, received correspondence at Sterling
Equities, III Great Ncck Road, Suite 408, Great Neck, New York 11021.

148. Amy Beth Katz is the wife of Gregory Katz.
149.

Amy Beth Katz held interests in different BLMIS accounts.

150. Amy Beth Katz is named as a Defendant in this action in her individual capacity, and as
joint tenant in the accounts identified in Section xn of the Amended Complaint.
151. Defendant Heather Katz KJ10pfmaintains her residence in Glen Cove, New York and, for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equiti es, 111 Great :t\ cck Road. Suite 408, Great Neck, 1\ ew York 11021.
152. Heather Katz Knopf is the daughter of Saul Katz.
153. Heather Katz Knopf held interests in different BL~lIS accounts.
154. Heather Katz Knopf is named as a Defendant in this action in her individual capacity, as
trustee oftbe Saul B. Katz Family Trust as beneficiary of the Saul B. Katz Family Trust,
as joint tenant, and as tenant-in-common in the accounts identified in Section XIJ of the
Amended Complaint.
155. Defendant Howard Katz maintains his residence in New York, 1\ew York and, for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equities, III Great Ncck Road, Suite 408, Great ?\cck, New York 1102 L
156. Howard Katz is the son of:rY'fichael Katz.
157. Howard Katz held interests in different BLMIS accounts.
158. Howard Katz is named as a Defendant in this action in his individual capacity, as
beneficiary ofthe Katz 2002 Descendants' Trust, and as tenant-in-common in the
accounts identified in Section XII of the Amended Complaint.
159. Defendant "Katalie Katz O'Brien maintains her residence in Glen Cove, New York and,
for purposes of the Sterling BLMIS Accounts at issue, received correspondence at
Sterling Equities, 111 Great Neck Road, Suite 408, Great Neck, New York 11021.
160. Natalie Katz O'Brien is the daughter of Saul Katz.
161. Natalie Katz O'Brien held interests in different BLMIS accounts.
162. Natalie Katz O'Brien is named as a Defendant in this action in her individual capacity, as
trustee of the Saul B. Katz Family Trust. as beneficiary of the Saul B. Katz Falnily Tn1.St,
as joint tenant, and as tcnant-in-common in the accounts identified in Section XII of the
Amended Complaint.

13

163. Defendant Todd Katz maintains his residence in Old Westbury, New Ymk and, for
purposes of the Sterling BLMIS Account~ at issue, received correspondence at Sterling
Equities, 111 Great Neck Road, Suite 408, Great Neck, New York 11021.
164. Todd Katz is the son of Michae1 Katz.
165. Todd Katz held interests in different BUv1JS accounts,
166. Todd Katz is named as a Defendant in this action in his individual capacity, as
beneficiary of the Katz 2002 Descendants' Trust, and a'5 tenant-in-common in the
accounts identified in Section XII of the Amended Complaint.
167. Defendant Daniel Wilpon maintains his residence in New York, New York and, for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equities, III Great Neck Road, Suite 408~ Great Neck, New York 11 02J.
168. Daniel Wilpon is the son of Richard Wilpon.

169. Daniel \\tilpon held interests in different BLMIS accounts,
170, Daniel Wilpon is named as a Defendant in this action in his individual capacity. and as
beneficiary of the Wilpon 2002 Descendants' Trust.
J 71.

Defendant Jessica Wilpon maintains her residence in Ne\v York, New York and, for
purposes of the Sterling BLl\.·lIS Accounts at issue, received correspondence at Sterling
Equities, 111 Great Neck Road, Suite 408, Great Neck, Nev,.: York 11021.

172. Jessica Wilpon is the daughter of Richard \Vitpon.
173. Jessica \Vilpon heJd interests in different BLMIS accounts.
174. Jessica Wilpon is named as a Defendant in this action in her individual capacity, and as

beneficiary of the Wilpon 2002 Descendants' Tmst.
175. Defendant Robin Wilpon Wachtler maintains her residence in Oyster Bay, New York
and, for purposes of the Sterling BLMIS Accounts at issue, received correspondence at
Sterling Equities, ] 11 Great Neck Road, Suite 408, Great Neck, New York 11021.
176. Robin Wilpon Wachtler is the daughter of Fred \\iilpon.
177. Robin \ViJpon Wachtler held interests in different BLMIS accounts.
178. Robin \Vi1pon Wachtler is named as a Defendant in this action in her individual capacity,
as beneficiary of the Fred Wilpon Family Trust, as joint tenant, and as tcnant-in-common
in the accounts identified in Section XII ofthe Amended Complaint
179. Defendant Philip Wachtler maintains his residence in Oyster Bay, New York and. for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equities, ~ 11 Great Neck Road, Suite 408, Great Neck, New York] 1021.
14

180.

Philip Wachtler is the husoand of Robin Wilpon Wachtler, daughter of Fred Wilpon.

181.

Philip Wachtler held interests in different BLMIS accounts.

182.

Philip Wachtler is named as a Defendant in this action in his individual capacity, as joint
tenant, and as tenant-in-common in the accounts identified in Section XII of the
Amended Complaint.

183.

Defendant Scott Wilpon maintains his residence in New York, New York and, for
pu..rposes of the Sterling BU"US Accounts at issue, received correspondence at Sterling
Equities, III Great Neck Road, Suite 408, Great Neck, New York 11021.

\84.

Scott Wilpon is the son of Richard Wilpon.

185.

Scott Wilpon held interests in different BLMIS accounts.

186.

Scott Wilpon is named as a Defendant in this action in his individual capacity, and as
beneficiary of the Wilpon 2002 Descendants' Trust.

] 87.

Defendant Ruth Friedman maintains her residence in Glen Cove, New York and, for
purposes of the Sterling BLMJS Accounts at issue: received correspondence at Sterling
Equities, III Great Neck Road, Suite 408, Great Neck, New Yor:( 1102].

188.

Ruth Friedman is the wife of Arthur Friedman.

189,

Ruth Friedman is named as a Defendant in this action in her individual capacity, and as
joint tenant in the accounts identified in Section XII of the Amended Complaint.

190.

Defendant Phyllis RebeIl Osterman maintains her residence in Stamford, Connecticut
and, for purposes of the Sterling BLMlS Accounts at issuc, received correspondence at
Sterling Equities, 111 Great Ncck Road, Suite 408, Great Neck, New York 11021.

191.

Phyllis Rebell Osterman is the \vife of Thomas OstemlaJ1.

192.

Phyllis Rcbell Osterman held an interest in approximately one (1) Sterling BLMIS
Account as a direct interest-holder.

193.

Phyllis Rebcll Osterman is named as a Defendant in this action in her indi'vidual capacity
in the account identified in Section xn of the Amended Complaint.

194.

Defendant Elise C. Tepper maintains her residence in Sands Point, New York and, for
purposes of the Sterling BU"f!S Accounts at issue, received correspondence at Sterling
Equities, 111 Great Neck Road, Suite 408, Great 'Neck, Nev,' York 11021.

195.

Elise C. Tepper is the ""ife of Marvin Tepper,

196.

Elise C. Tepper held interests in different BLyHS accounts.

1S

197.

Elise C. Tepper is named as a Defendant in this action in her individual capacity, as joint
tenant, and as tenant-in-common in the accounts identified in Section XII of the
Amended Complaint.

198. Defendant Jacqueline G. Tepper maintains ber residence in Stamford, Connecticut and,
for purposes of the Sterling BLMIS Accounts at issue, received correspondence at
Sterling Equities, 111 Grcat Neck Road, Suite 408, Great Neck, New York 11021.
199. Jacqueline G. Tepper is thc daughter of r-.,,-iarvin Tepper.
200. Jacqueline G. Tepper held interests in different BLMIS accounts.

201. Jacqueline G. Tepper is named as a Defendant in this action in her individual capacity,
and as tenant-in-common in the accounts identified in Section XII of the Amended
Complaint.
202. Defendant Edward M. Tepper, for purposes of the Sterling BLMIS Accounts at issue,
received correspondence at Sterling Equities, 1 J 1 Great Neck Road, Suite 408, Great
Neck, New York 11021.
203. Edward M. Tepper is the son of Marvin Tepper.
204. Ed\vard 1\t Tepper held interests in different BLMIS accounts.
205. Edward M. Tepper is named as a Defendant in this action in his individual capacity, and
as tenant· in-common in tl'le accounts identified in Section xn of the Amended
Complaint.
206. Defendant Deyva Schrcier Arthur maintains her residence in Troy. New York and, for
purposes of the Sterling BLMIS Accounts at issue, received correspondence at Sterling
Equities, 111 Great Neck Road, Suite 408, Great Neck, New York 11021.
207. Deyva Schreier Arthur is the daughter of the late Leonard Schreier, a former Sterling
Partner, whose BLMlS Account interests after his death through the Filing Date were
held by his estate.
208. Deyva Schreier Arthur held interests in different BLMIS accounts.
209. Deyva Schreier Arthur is named as a Defendant in this action in her individual capacity,
as beneficiary ofthe Estate of Leonard Schreier, and as tenant-in-common in the accounts
identified in Section XU of the Amended Complaint.
210. The Sterling Partners and related borrowers regularly used their BLr\IIS securities
accounts to satisfy liquidity requirements or as collateral.

211. At least 28 K\\,' BLMIS Accotmts in which the Sterling Partners. their family members,
trusts or related entities held interests were used as collateral for bank loans, the proceeds
of which were used for the specific purpose of investing with BLMJS
16

Exhibit 2A

Exhibit 2{A) to Pretrial Consent Order
Picard v. Saul B. Katz, et aI.,

1l~CV-03605

(JSR

Pursuant to pa.ra.graph 4( c) of this Court's Indiyidual Rules, the Trustee hereby sets forth
the specific contentions as to the facts that are disputed:
1.

The Defendants are sophisticated investors.

2.

The Defendants have an expertise in the financial industry and are general

partners in a hedge fund of funds with an expertise in due diligence.

3.

The Defendants treated their BLtv'lIS investments as a "sure thing:'

4.

The Defendants were a\\-'are of facts suggesting a high probability of fraud at

BLMIS.
5.

The Defendants consciously avoided confinning any facts suggesting a hig::t

probability of fraud at BU.. .US.
6.

The Defendants did not engage in any diligence of their BLMIS investments in

response to any "red flags" suggesting a higb probabiJity of fraud at BUvHS.

7.

The Defendants had a financial motivation to ignore any "red flags" suggesting a

high probability of fraud at BLMIS,
8.

The Sterling Equities Partner Defendants operate the Sterling businesses as one.

9.

The Sterling Equities Partner Defendants treated their BLMTS investments

col1ectively and as part of their business.
10,

The willful blindness to BL"YlIS' fraud of anyone Sterling Equities Partner

Defendant is imputed to all the Sterling Equities Partner Defendants,

11.

The willful blindness to BLMIS' fraud of any Sterling Equities Par":ner Defendant

is imputed to any Sterling Entity Defendant in which a Sterling Equities Partner Defenda.nt with
the requisite lack of good faith is an officer. manager, member, agent, and/or equitable owner.

12.

The willful blindness to BLMIS' fraud of any Sterling Equities Partner Defendant

is imputed to any Sterling 1\'on-Partner Family Defendant for \vhich any Sterling Equities ParL'1er
Defendant with the requisite lack of good faith served as an agent with respecl to their BT.-MIS
investments and/or equitable owner.

Exhibit 28

PRETRlAL CONSENT ORDER IN PICARD V. KATZ, ET AL, ll-CV-03605 (JSR)

Defendants'

1.

Sp~cific

Contentions As to the Facts that Are Disputed

Individual Court Rule 4(c)

During the t\,\lO year period at issue before the collapse of Bernard L. Madoff
Investment Securities LLC ("MadoffSeeurities"), no Defendant was willfully
blind ""hen making deposits into his. her. or its Madoff Securities accounts.
No Defendant subjectively believed there was a high probability that
Bernard L. Madoff ("~'fadoff") was not trading securities and was running
a Pooli scheme.
No Defendant took deliberate action to avoid learning through casi;y
accessible information or othcrv.:ise that Madoffwas :1ot trading securities
and was running a Ponzi scheme.

2.

The knowledge . beliefs, and conduct of anyone Defendant cannot be imputed to
any other Defendant with respect to investments in Madoff Securitics accounts.
Each Defendant was responsible for the amount and timing of his.. her, or
its own investment in his, her, or its securities account maintained at
i\.1adoff Securities.
No Defendant authorized any other Defendant to act as agent to decide the
amount or timing of investments in his, her, or its securities account
maintained at MadotT Securities.
::\either the partners of Sterling Equities as a group" nor Saul Katz or
Arthur Friedman individually, controlled or made investment decisions
with respect to Madoff Securities accounts owned by other Defendants .
Every entity, tnlS!' foundation, or other similar Defendant had a separate
legal existence anci/or corporatc form that at all times \vas respected.

3.

No Defendant alleged to have received a subsequent trar..sfer did so with
knowledge that the reIev!1ot initial transfer was avoidable.

4.

No alleged subsequent transfer can be traced from an avoidable initiallransfer
from Madoff Securities to any Defendant.

Exhibit 3A

Exhibit 3(A) to Pretrial Consent Orrle.r.

Picard P. Saul B. Katz, et al., ll-CV-03605 (JSR

Pursuant to paragraph 4(e) of this Court's Individual Rules, the Trustee hereby sets forth a
list of the names of witnesses (both fact witnesses and expert witnesses) that each party
intends to call, in the likely order of appearance. I
1.
2.
3.
4.
5.

6.
7.
8.
9.

10.
11 .
12.
13.

Bruce Dubinsky (expert)
Saul Katz
Arthur Friedman (via video deposition)
Cynthia Rongione
Lisa Collura 2 (expert)
Matt Greenblatt (expert)

Leonard Labita
Maureen Hawa (via video deposition)
Mark Peskin
Joseph Reese

Michael Katz
Steven Kenny
Kevin Barcelona

14.
15.
] 6.

Peter Stamos (via video deposition)
Basil Stamos (via video deposition)

Kevin Dunleavy

17.

David Katz
Noreen Harrington

18.

I The Trustee reserves all rights as necessar) to call rebuttal witnesses not idcnli ['ied herein.
2 A possible agreemem or stipulation between the Partie, rna)' obviate the need for all or P8rt of Collura and

Greenblatt's testimony.

Exhibit 38

PRETRIAL CONSENT ORDER IN PICARD V. KATZ, ET AI., 11~CV~03605 (JSR)
Defendants' Witness List in Likely Order of Appearance
Indiddual Court Rule 4(e)

1.

2.
3.
4.

5.
6.
7.

8.

9.
10.
11.
12.

Fred Wilpon
Mark Peskin
Saul Katz
Arthur Friedman>!'
Peter Stamos
.Ashok Chacnra
Steve Kenny
Charles Klein
Robert Rosentha I
f..1ichael Dowling
Sandy Koufax
Robert Morgenthau

'" Due to illness. Me Friedman is unavailable for tTial and , .. ill be appearing by
videotaped deposition.