Thursday, 28 July 2016
Last updated 1 hour ago
May 10 2010 | 12:13pm ET
Bernard Madoff feeder hedge fund manager J. Ezra Merkin has lost his bid to have a tabloid publisher’s lawsuit against him tossed.
A New York state judge last week rejected Merkin’s motion to dismiss Mortimer Zuckerman’s fraud lawsuit against him and his Gabriel Capital Corp., one of three Madoff feeders the former GMAC chairman ran. Justice Richard Lowe ruled that neither of Merkin’s contentions “has any merit.”
Lowe did toss Zuckerman’s claim of negligent misrepresentation.
Zuckerman, the chairman of Boston Properties and owner of the New York Daily News, sued Merkin last year over losses he and his charitable foundation suffered in the Madoff Ponzi scheme. Zuckerman’s charitable trust, CRT Investments, had $25 million invested in Merkin’s Ascot Fund, and he personally had $15 million invested in a second Gabriel Capital hedge fund.
Substantially all of Ascot’s funds were invested with Madoff, while more than 20% of Gabriel’s assets were invested with the fraudster.