Settlement talks between the Mets and the trustee recovering money for Bernie Madoff’s victims reportedly broke down this afternoon amid a dispute over the leaking of information from a sealed lawsuit, according to The Wall Street Journal.
“We are no longer pursuing settlement negotiations,” said David Sheehan, a lawyer for the trustee Irving Picard, who filed a lawsuit against Mets owner Fred Wilpon and his associates.
MORE: JP MORGAN OVERLOOKED EARLY DOUBTS ON MADOFF, LAWSUIT SUGGESTS
LETTER TO THE JUDGE ASKING FOR LAWSUIT TO BE UNSEALED (PDF)
Documents in the case are expected to be released today.
After Wilpon announced last Friday that up to quarter of the baseball team would be up for sale, details of the lawsuit leaked out.
Lawyers for Wilpon criticized the leaks in court papers and interviews.
Sheehan said the leaks didn’t come from his office.
“Defendants cannot cry confidentiality to this court while publicly attacking the complaint and continuing to frustrate the public’s right to know the contents of the same complaint they disparage,” Sheehan said in a letter sent today to Judge Burton Lifland.
Picard’s lawsuit seeks more than $300 million in what the trustee said were false profits withdrawn by Wilpon, his associates and relatives from the Ponzi scheme.
Wilpon said Friday in a conference call announcing that the owners were seeking to sell a 20 to 25 percent stake that “it is prudent for us to explore our options at this point,” implying that the sale process had just begun.
In reality, the process has been going on for months, sources tell The Post.
The team, owned by Sterling Equities, which is controlled by Wilpon and his son, Jeff, is worth between $750 million and $1 billion, once source said.
Forbes last year pegged the value of the franchise at $858 million.
But the team has roughly $700 million of debt and that should be subtracted from the valuation when calculating what an owner’s stake is worth, sources said. Using the $858 million valuation and the $700 million in debt, a 25 percent stake in the free equity amounts to just $39.5 million — not the $200 hundred million asking price.
While Sterling’s 60 percent stake in its cable network, SportsNet New York, could be worth hundreds of millions, it cannot be used to attract minority investors to the team, according to sources.
Sterling would have to distribute any proceeds from the sale of its SNY stake to lenders under the terms of their credit agreement, according to three sources close to the situation.
With AP