The Companies Law (2009 Revision) and Bernard L. Madoff Investment Securities LLC (in Securities Investor Protection Act liquidation)

JurisdictionCayman Islands
JudgeThe Honourable Mr Justice Andrew J. Jones
Judgment Date05 February 2010
CourtGrand Court (Cayman Islands)
Docket NumberCAUSE NO. FSD41-0F 2010
Date05 February 2010
In The Matter of The Companies Law (2009 Revision)
And In The Matter of Bernard L. Madoff Investment Securities LLC (in Securities Investor Protection Act liquidation)
[2010] CIGC J0205-2

Mr Justice Andrew J. Jones QC

CAUSE NO. FSD41-0F 2010 (Originally Cause NO.504 of 2009)
IN THE GRAND COURT OF THE CAYMAN ISLANDS FINANCIAL SERVICES DIVISION
JUDGEMENT
1

This is a petition by Irving H Picard in his capacity as Trustee of Bernard L. Madoff Investment Securities LLC (‘BLMIS’) by which he seeks a declaration pursuant to section 241 (1)(a) of the Companies Law (2009 Revision) recognising his right to act in the Cayman Islands on behalf of or in the name of BLMIS.

2

Section 241(1) provides that ‘upon the application of a foreign representative the Court may make orders ancillary to a foreign bankruptcy proceeding for the purposes of — (a) recognising the right of a foreign representative to act in the Islands on behalf of or in the name of a debtor’. Mr Picard's petition does not go on to seek any further ancillary relief under paragraphs (b) to (e) of section 241(1).

3

The expression ‘foreign representative’ is defined to mean a trustee, liquidator or other official appointed in respect of a debtor for the purposes of a foreign bankruptcy proceeding. ‘Debtor’ is defined to mean a foreign corporation or other foreign legal entity subject to a foreign bankruptcy proceeding in the country in which it is incorporated or established. BLMIS was incorporated in accordance with the laws of the state of New York in 1960 and is now the subject of bankruptcy proceedings pending before the Honourable Burton R. Lifland in the United States BankruptcyCourt for the Southern District of New York. On 15th December 2008 Mr Picard was appointed trustee for the liquidation of the business of BLMIS with all the duties and powers of a trustee as prescribed in the United States Securities Investor Protection Act of 1970. The effect of these orders, as a matter of United States law, is that the powers of BLMIS' former directors and managers are terminated and Mr Picard is now the only person entitled to act on behalf of the company. He has powers and duties which are broadly equivalent to those of an official liquidator appointed under Part V of the Companies Law (2009 Revision). By his petition, Mr Picard seeks a declaration that, as a matter of Cayman Islands law, he is entitled to be recognised as the only person entitled...

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