Baker Hostetler serves as Court-appointed counsel to Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (“BLMIS”). In December 2010, the Trustee obtained a $5 billion settlement for BLMIS customers with allowed claims. Plaintiffs in putative class actions challenged the settlement and the Bankruptcy Court’s decision holding that the class actions violated the automatic stay of the Bankruptcy Code and were otherwise enjoined. Yesterday, the United States District Court for the Southern District of New York upheld the settlement and the Bankruptcy Court’s decision finding that the class actions were duplicative or derivative of the Trustee’s action and thus were void ab initio under the automatic stay and otherwise enjoined. The District Court specifically upheld the Bankruptcy Court’s entry of a permanent injunction. Read the decision here.
