A judge has rejected a bid by an accused Bernie Madoff accomplice to have a lawsuit by New York Attorney General Cuomo dismissed.

Ezra J. Merkin, who is accused of funneling billions of investors to notorious Ponzi scammer, is facing civil charges under the Martin Act, which grants the Attorney General special powers to punish Wall Street fraudsters.

State Supreme Court Justice Richard Lowe today ruled that Cuomo has sufficient grounds to pursue the lawsuit. Merkin is alleged to have lost some $1.2 billion in investor money while ringing up $470 million in management and incentive fees.

The funds Merkin ran acted as so-called feeder funds, or funds that invest in other funds. Merkin’s funds were heavily — and in some cases entirely — invested in Madoff’s funds.

Cuomo alleges that Merkin’s marketing materials and offering documents promoting his funds “falsely represented that [he] was involved in day-to-day management, and that the success of the fund depended on Merkin’s abilities as a money manager,” the order reads.

Cuomo is not accusing Merkin of having knowledge of Madoff’s scam, but claims that he manager misrepresented facts and failed to perform sufficient due diligence on Madoff.

Madoff was sentenced back in June to 150 years in prison for running a massive Ponzi scheme that lost investors $65 billion.