The Good News: Flavor Flav says he's still in possession of Simpson's famous statue of himself (the one featured in "The People Vs. O.J. Simpson") and will gladly give it back to his old friend.

The Bad News: If Simpson accepts Flav's offer, Fred Goldman could get a judge to force O.J. to sell it immediately to pay off part of the judgement against him in the wrongful death case.

Little backstory ... the statue was seized from Simpson's home and put up for auction in 1999 with the profits going toward paying off the $33.5 million judgement awarded to the families of Ron Goldman and Nicole Brown.

The statue was purchased for $3,250 by radio host Mancow Muller -- who later gifted it to Flav.

But the Public Enemy rapper says he'd gladly return it to Simpson when he gets out of prison in October ... if Simpson wants it back.

Flav says he previously tried to return it but O.J. refused the gift -- saying at the time, "They (meaning the Goldmans) would just take it away again."

There could be a TON of money at stake this time around -- Flav has been shopping the statue with a 6-figure price tag. We're told he's received offers close to asking, but so far, no deal has been made.