We have witnessed a significant turning point in the development of private fund case law. U.S. trial and appellate court decisions, coupled with groundbreaking decisions offshore and by the Privy Council, addressing clawback and investor claims puts a bookend on the legal issues surrounding Madoff claims.

More importantly, however, those cases provide much greater clarity for funds, investors and managers going forward. As is the case in the securities world, private fund litigants now have a much better sense of the legal framework within which they operate.

Perhaps the silver lining to Madoff's fraud is the creation of legal principles that will guide players in the industry for years, if not decades, to come.