In re Tremont Securities Law, State Law and Insurance Litigation (S.D.N.Y.)

Investors burned by the $50 billion Ponzi scheme orchestrated by Bernard L. Madoff have turned to E&C for assistance.  On March 26, 2009, Senior United States District Court Judge Thomas P. Griesa appointed E&C co-lead counsel to prosecute certain claims on behalf of investors in various Madoff “feeder funds” established and run by Tremont Group Holdings, Inc. and Tremont Partners, Inc. (collectively, “Tremont”).

On April 20, 2009, E&C filed a First Consolidated and Amended Class Action and Derivative Complaint asserting claims involving the following five Madoff feeder funds: Rye Select Broad Market Fund, L.P., Rye Select Broad Market Prime Fund, L.P., Rye Select Broad Market XL Fund, L.P., Rye Select Broad Market XL Portfolio Limited, and Rye Select Broad Market Portfolio Limited.

The complaint asserts both class and derivative claims concerning Tremont’s failures to conduct adequate due diligence of Madoff’s investment operations.  The claims asserted against Tremont are for breach of fiduciary duty and breach of contract.  Additionally, the complaint asserts claims for unjust enrichment and aiding and abetting Tremont’s fiduciary duty breaches against companies affiliated with Tremont, such as Massachusetts Mutual Life Insurance Company, MassMutual Holding Company, Oppenheimer Acquisition Corp., and OppenheimerFunds, Inc.  Defendants have moved to dismiss the complaint and E&C has aggressively opposed those applications.