CDR – Primeo Fund v HSBC: On reflection

The Cayman Islands Court of Appeal has dismissed the USD2 billion appeal by Primeo, a Madoff feeder fund. Andrew Pullinger and Shaun Tracey of the Cayman Islands office of Campbells discuss the wider significance of the judgment, particularly on the law concerning the rule against the recovery of reflective loss.

Despite more than a decade now having passed since Bernard Madoff’s arrest, litigation resulting from Madoff’s infamous Ponzi scheme continues. In Primeo Fund v Bank of Bermuda (Cayman) and HSBC Securities Services (Luxembourg) S.A. (HSBC), the Cayman Islands Court of Appeal (Justices Birt, Beatson and Field) has delivered the latest significant judgment in a recovery action by a Madoff feeder fund.