The Madoff Litigation: No Billion Dollar Jackpots, More Like 'Medium-Sized'
Professor Robert Weisberg is quoted in a Law.com article about the amount of money investors are likely to recover in settlements from lawsuits surrounding Bernard Madoff's alleged Ponzi scheme:
Lawsuits are flying in the aftermath of Bernard Madoff's alleged $50 billion investment fraud, but legal experts don't expect to see investors recovering large amounts of their lost funds.
With the Madoff funds looking like something of a recovery dead-end for investors who lost millions, several litigators have said that they plan to try to recover investor funds from the third-party institutions that funneled money to Madoff, such as banks, hedge funds and investment firms.
That creates an opportunity for litigation, although it remains to be seen how lucrative such third-party suits will be. Stanford Law professor Robert Weisberg said litigation over the Madoff fraud may prove to be a "loss leader," meaning firms won't make much money trying to recover investors' funds. Still, Weisberg said, the publicity of being involved in such a high-profile case could make it worthwhile for firms in the long run.
"I think there are firms that are doing this on spec. They are circulating their businesses cards," Weisberg said. "Getting your name out there is important, even if there isn't much potential for recovery."