DRUMMOND WOODSUM OBTAINS FAVORABLE JURY VERDICT IN MADOFF-RELATED SECURITIES LITIGATION
July 23, 2014
Portland, ME (July 23, 2014) – Drummond Woodsum Attorney James Kilbreth and David Spears of Spears & Imes in New York successfully represented John L. Steffens, Gregory P. Ho, Spring Mountain Capital, G.P. LLC, Spring Mountain Capital, L.P. and Spring Mountain Capital, LLC in a lawsuit brought by Daniel and Suzanne Goldenson, as well as two entities the Goldensons controlled.
The lawsuit, initiated in 2010 in the United States District Court in Portland, Maine, sought to hold the Defendants responsible for the Plaintiffs' losses from the massive Ponzi scheme perpetrated by Bernard Madoff. It alleged breach of fiduciary duty, fraudulent misrepresentation, securities fraud and intentional infliction of emotional distress. After a ten-day trial, the jury unanimously concluded that the Defendants, who were also victims of Madoff's scheme, had done nothing wrong and returned a verdict in their favor.
James Kilbreth said, "It has been a long, hard-fought battle and we are thrilled with the jury's recognition that our clients met their duties and obligations as investment professionals. Our clients have shown great perseverance and resolve throughout and fully deserved this vindication."
Steffens, the former Vice-Chair of Merrill Lynch, and Ho started Spring Mountain Capital in 2001. Its first investment fund was a fund of funds, which pooled investors' money and invested in over 40 funds. One of the funds Spring Mountain invested in was the Ascot Fund, which was a Madoff feeder fund. Plaintiffs invested $2 million in Spring Mountain's first fund and additional sums in other funds. Overall, the Plaintiffs made $1.6 million on their investments in Spring Mountain funds. Separately, they invested $2 million in the Ascot Fund and lost approximately $1.1 million on this investment as a result of the Madoff Ponzi scheme. Although Ascot's relationship with Madoff was well-known, the lawsuit claimed that the Defendants had failed to disclose Ascot's connection to Madoff and were therefore responsible for the losses the Plaintiffs incurred on their separate investment in Ascot. The jury resoundingly rejected all the Plaintiffs' claims.
On August 7, 2014, attorney Jamie Kilbreth, a member of Drummond Woodsum's Litigation Group, was quoted in the Portland Press Herald article entitled "Bremen Couple Bilked by Madoff Lose Case."
The article discusses a 10-day federal jury trial in Portland that ruled against a Bremen couple who sued their financial adviser after he persuaded them to invest in a fund that was tied to infamous stockbroker Bernie Madoff. "Their claim was about losses in a fund that we didn't manage," Kilbreth said. "Their claim didn't make any sense. I think the jury felt that it (the lawsuit) was a way to blame someone for the Madoff disaster."
To read the article in its entirety, please click here.