Divorce attorneys in Pasadena have seen some interesting divorce settlements. In New York, Steven Simkin, whose divorce settlement already has been decided in court, is going to get a crack at getting some of his money back. Part of his settlement was based on millions of dollars that Simkin had invested with Bernard "Bernie" Madoff. He claims he got a raw deal while his ex-wife got a windfall.
After a lower court had thrown out the case, the Appellate Division of the New York State Supreme Court ruled to reinstate Simkin's lawsuit against his wife. The couple divorced after 33 years of marriage, and the divorce settlement included millions of dollars in assets to be paid by Simkin to his wife. For his part in the settlement, Simkin kept the Madoff investment accounts after the split. He is claiming that $2.7 million dollars represents half of the Madoff account which Simkin agreed to pay to his ex-wife; the Madoff investments went completely bust. Simkin's lawsuit claims that the deal was unfair, since the settlement awarded him the Madoff assets which were worthless.
The majority of the judges in the appellate court agreed that Simkin received a worthless asset in the divorce settlement. The majority wrote that "Steven never had an account, (because) on Madoff's own admission, there were no accounts within which trades were made."
Simkin's ex-wife and her lawyers, as well as two dissenting judges, beg to differ with the decision. They claim that the original deal was made in good faith and that the Madoff investments only became worthless after the divorce settlement was already agreed. They claim that it was Simkin who negotiated to maintain the investments for himself. In this reading of the issue, Simkin took a risk and lost - tough luck.
"The point here is that: When is a deal a deal? This clearly is a divorce deal which was a deal in 2006, not to be reopened later on," says one of the lawyers representing Simkin's ex-wife.