Madoff trustee Irving Picard and Bernie Madoff's victims had a lousy week in court.  A judge ruled that Mr. Picard may try to claw back fictitious profits only from the last 2 years before Bernie Madoff turned himself in and disclosed his decades-old fraud in December 2008.  The ruling is likely to affect the trustee's claims against hundreds of former customers of Bernard Madoff. The judge who issued the rule, U.S. District Judge Jed Rakoff, made a similar ruling last year, when he reduced Picard's claims in a lawsuit against the principal owners of the New York Mets Baseball team.  Owners Fred Wilpon and Saul Katz ultimately agreed to settle the litigation, but Judge Rakoff has yet to sign off on it. Rakoff's Latest Opinion, Dated April 30. Irving Picard had sought to claw back 6 years or more of profits, as he did in the case of Wilpon and Katz, whose potential liability was reduced to $386 million from $1 billion.  But Judge Rakoff threw out claims, who refers in his opinion to "innocent investors" who were not accused by the trustee of knowing about the fraud, as he has with a number of sophisticated investors such as banks and funds. Obviously, the profits were deemed fictitious because consistently high returns to investors spanning decades were simply made up by Madoff and some of his employees at Bernard L. Madoff Investment Securities LLC. Trustee Picard Foresaw Concern for NY Mets Owners Ruling. The trustee expressed concern last October about an adverse decision in his case against the owners of the NY Mets.  Specifically, he noted that if the decision was upheld under appeal and applied to other litigation, Mr. Picard's team of lawyers could be precluded from seeking about $2.6 billion in fictitious profits and an additional $8.3 billion in principal sought from "bad faith" customers and funds that fed the Madoff firm. Picard can appeal Judge Rakoff's latest opinion. Picard, who filed his cases in bankruptcy court, says he has recoveries and settlement agreements totaling $9.1 billion, but $6.4 billion of that is unavailable due to appeals and reserves.  About $2.3 billion is in a fund to pay back swindled customers whose claims have been allowed. So far, about $329.6 million has been distributed, according to the trustee's website, http://www.madofftrustee.com/ The case: Securities Investor Protection Corporation v Bernard L. Madoff Investment Securities LLC, U.S. District Court for the Southern District of New York, No. 12-mc-0115. [Reuters, 5/1/12]