Irving Picard, the trustee liquidating Bernard L. Madoff’s money management firm, said he will dismiss common-law claims against Maxam Capital Management and its founder, former Tremont Capital Management CEO Sandra Manzke.
Mr. Picard sued Maxam, some of its funds and Ms. Manzke in December, demanding return of so-called fraudulent transfers out of the Ponzi scheme and accusing them of unjust enrichment and constructive trust. Maxam asked U.S. District Court Judge Jed Rakoff to dismiss the common-law claims, basing its request on the judge’s July ruling that threw out almost $9 billion in damages Mr. Picard demanded from HSBC Holdings and feeder funds using common claims. Mr. Picard last week appealed Mr. Rakoff’s ruling on the HSBC claims.
“The parties wish to avoid the expense and time of additional resources in connection with defendants’ motion to dismiss the common law claims,” Mr. Picard said in a filing in U.S. District Court in New York on Tuesday.
Mr. Picard sought $100 million in transfers from Maxam, plus $5.8 million in fees from Ms. Manzke, in addition to her $1.8 million Pound Ridge, N.Y., house and $500,000 she took out of the Maxam fund in 2008. Mr. Picard said the bankruptcy-law claims would remain.
The common-law claims may be renewed if another court “determines that the trustee is permitted to advance common law claims,” Mr. Picard said. A constructive trust would transfer assets back to the Madoff estate, according to Mr. Picard’s lawsuit.