The real scammer of Beverly Hills? A suspected Ponzi scheme threatens to ruin the famed attorney Tom Girardi

Early last year, Erika Jayne, the flamboyant club singer and “Real Housewives of Beverly Hills” star, was at the top of her game. The 49-year-old had landed a lead role in the Broadway musical “Chicago,” lived in a 10,000-square-foot Pasadena mansion, flew on a private Gulfstream jet, and spent $40,000 a month on her glam squad, toting her makeup artist, hair stylist and creative director from Dubai to Amsterdam and beyond. She was the living embodiment of her hit song “XXPEN$IVE,” whose lyrics include “it’s expensive to be me.”

The source of all that wealth, as she has been frank about, was her husband, Thomas V. Girardi. They married in 2000 when Erika, 33 years Girardi’s junior, was working as a restaurant server. Girardi, a legal superstar who steered the lawsuit that the movie “Erin Brockovich” is based on, was considered one of the best plaintiffs’ lawyers in the United States. But if Erika was expensive, Girardi was the real “diva” in the relationship, Erika said.

Their Pasadena house had armed guards, and Girardi had tables at a Morton’s steakhouse, close to his Wilshire Boulevard office, with a supply of his preferred Burgundy, Clos Vougeot, on hand. They had two private planes and a collection of cars, including an Aston Martin DB11 Volante, a Land Rover, and a Mercedes S560. He funded a Frank Gehry-designed building at his alma mater.

His firm, Girardi Keese, cranked out tort cases the way other firms made photocopies, suing giants like Shell or Boeing on behalf of everyday people who the firm said were injured, killed, or deceived by corporations. “His reputation is, he’s a superstar, and deservedly so,” Robert A. Clifford, a Chicago lawyer who knows Girardi, said.

Until it all crumbled. “I don’t have any money,” Girardi told a judge in September. “That’s all gone.”

Girardi, who last year won an International Legendary Lawyer Award, is accused of stealing millions from clients, lawyers, and lenders. Girardi Keese has effectively gone under, Girardi’s law license has been suspended, and Erika is divorcing him — just in time, some speculate, to protect her assets from bankruptcy proceedings.

The very lawyers who once praised Girardi now suspect him of having run a Ponzi scheme — taking money earmarked for clients and using it for his own extravagances and to pay off other clients waiting for funds. They say the alleged scheme, which started to unravel years ago, seemed to fall apart when the coronavirus shut down courts. Without new settlements being approved, there was a cork in Girardi’s money flow, insiders say.

At a December hearing, a federal judge overseeing a case in which Girardi is accused of stealing $2 million from families of victims of the 2018 Lion Air crash warned Girardi of the severity of the allegations.

“No matter what your personal financial situation is, no matter what kind of pressures you’re under,” Thomas M. Durkin said, “if you touch client money, you’re going to be disbarred and, quite possibly, charged criminally.”

The dramatic past two years of Girardi and Erika life, pieced together from thousands of pages of court documents stemming from dozens of cases, along with interviews with friends, colleagues, and adversaries, show a couple that, facing increasingly serious legal and financial problems, continued to live their best, most lavish lives, on-screen and off.

With his professional reputation shattering, Girardi’s brother Robert and his lawyer are now contending that the famed attorney has late-onset Alzheimer’s disease and dementia and can no longer understand court proceedings against him — assertions that opposing lawyers seriously question. During an October legal podcast, Girardi defended himself against the “greedy plaintiffs’ lawyer” reputation, epitomized by gel-haired attorneys who took out TV ads, drove flashy cars, and raked in the cash.

After all, plaintiffs’ lawyers — who assume all the costs of litigation in exchange for a third or more of the final verdict or settlement — stake their careers on making big bets.

“We have not told the ladies and gentlemen of America what we do, and how we do it, and what we do it for. How we gamble everything,” Girardi said.

This time, it seems, Girardi may have lost.

Girardi, who is 81, grew up in the Los Angeles area and went to Loyola High School. He later attended Loyola Marymount University and Loyola Law School, marrying his first wife — a finalist for Loyola’s homecoming queen — in 1964, the same year he graduated from law school. Girardi went into plaintiffs’ law, and his timing couldn’t have been better.

The public was becoming increasingly skeptical of government regulators’ ability to investigate corporate missteps. In 1966, the modern class-action lawsuit was created, enabling lawyers to make serious money from plaintiffs’ law. Now hundreds or thousands of clients could be gathered to harness complaints, demand a change in policy, and, perhaps most important, collect payment.

As David Marcus, a UCLA law professor, wrote in a history of plaintiffs’ law: “To anyone interested in buccaneering attorneys, maverick judges, mind-boggling settlement sums, idealistic lawyering, or base legal corruption,” the past few decades have “yielded a rich harvest.”

The growth of plaintiffs’ law firms was seen as either correcting corporate greed or incentivizing litigation-hungry, ethically questionable lawyers. Girardi’s early cases were penny-ante versions of the sort he’d become famous for (in 1970 he sued a manicure salon for $100,000, alleging it inflicted “infection and great injury” on his client’s hands).

In 1996 he settled with Pacific Gas and Electric Co. in a case made famous by the 2000 movie “Erin Brockovich.” Girardi represented Hinkley, California, residents whose groundwater had been contaminated, winning the blue-collar plaintiffs $333 million. Girardi and other plaintiffs’ lawyers typically take between 33 and 40% of a settlement.

He sued chemical companies on behalf of workers for Lockheed who said they’d been unknowingly exposed to toxic chemicals on the job. He negotiated a $4.85 billion settlement in cases over the arthritis drug Vioxx. He sued pharmaceutical companies over hormone-replacement drugs, saying they caused breast cancer. In one of his most recent high-profile wins, he convinced a jury that the LA Dodgers were negligent in providing security after a fan was severely beaten outside their stadium, winning the man an $18 million verdict at trial.

Girardi with David and Ann Stow, the parents of Bryan Stow, who was beaten outside Dodger Stadium. Girardi won the victim an $18 million verdict.MediaNews Group/Orange County Register/Getty Images

Some lawyers win on motions, others at opening arguments. Girardi’s specialty was the jury.

“He managed to relate to the jurors … to get them to like him before the case started,” said James Baratta, a California lawyer who tried cases against Girardi. “He didn’t act like a lawyer. He acted like someone who cared for his clients.”

Girardi felt “the case is won or lost with jury selection,” he told a fellow lawyer in October, and hired people, including his retiree father, to gauge potential jurors’ reactions to him during selection. While other lawyers read witness statements or judges’ rulings to prepare for closings, Girardi studied the minutes from jury selection so that he could tailor his argument to the jurors’ biographies and interests. Out of court, he uses hepcat phrases from the 1950s — “baby” and “real cool” — but in court he was plain spoken. “I think they stink (for) what they did,” he told the jury in the 1994 Lockheed case. “As a worker, you’d feel pretty tricked, pretty mad.”

Girardi was a hard worker, arriving at his Wilshire Boulevard office before the youngest and most ambitious of lawyers at the firm. Once, when he was in the midst of cross-examination, an earthquake struck, said Amy Fisch Solomon, a longtime Girardi Keese lawyer. While everyone else ducked under tables, “Tom’s back up, trying to redo his cross-examination, not to miss the moment,” she said.

He relied on his gut rather than extensive preparation.

“Just him showing up was added value, even if he had no clue what the case was about or the important case law on it or even the plaintiff’s name, he could show up and make it rain,” said Graham LippSmith, who worked at Girardi Keese for 14 years. “He truly had the Midas touch.”

Girardi Keese (his founding partner, Robert Keese, retired a decade ago) was simply known as “Girardi’s” by other employees there. He was the 100% owner of the firm, he assured lenders in documents included in their lawsuits. He was also the sole controller of its finances, his son-in-law, David Lira, a former lawyer there, said in court documents. The so-called partners didn’t share in the profits: The best the other lawyers could hope for was a “good job” voicemail or small bonus.

Lawyers at Girardi’s were expected to be part of its namesake’s social life, which meant rounds of lunches at Morton’s, Girardi’s preferred steakhouse, or drinks at the Jonathan Club, a private downtown boîte, listening to Girardi’s war stories and keeping him company. After an argument with his previous haunt, the Pacific Dining Car, Girardi sent a memo barring anyone from eating there again.

Erika and Tom Girardi.Steve Eichner/NameFace/SIPA USA

And they listened, of course. After all, Girardi was a major player in the Los Angeles legal scene. He hosted Super Bowl parties for prominent judges and lawyers, at the Palm or Wolfgang’s, with open bar, full steak dinners, and entertainment like Penn & Teller. Jay Leno and Christopher Cross performed at Girardi’s lawyer-convention dinners, and he always made sure to send new bar-association officials notes of congratulations. There was a point: He was entertaining lawyers, judges, mediators, bar officials, service providers — and those connections could be important, as an increasing number of lawsuits were filed against him.

Indeed, in recent years Girardi’s legal work seemed to take a back seat to his social life. Brian S. Kabateck, a California consumer lawyer, said Girardi’s presence in court had “substantially diminished.” Even when his wife, Erika, called him about her 2015 first-season contract with Bravo’s “Real Housewives,” he instructed her to sign it without his or her reading it, which so alarmed the producers that they asked her to re-sign it days later, according to her autobiography, “Pretty Mess.”

By then, Girardi was in a financial balancing act that was about to upend his career.

The clues were there all along, if anyone cared to look. But until recently, few people did. For years, a number of clients had been complaining, both publicly and in lawsuits, that Girardi Keese hadn’t paid them their full settlement amounts, or had dipped into their settlement funds. Client funds are supposed to be put into a separate account and not touched by lawyers for any reason. Violating that, said Jay Edelson, a Chicago trial lawyer, is “an original sin for an attorney.”

But given Girardi’s reputation, and his position at the center of the California legal world, it was difficult for other lawyers to believe that these claims had any merit. “The first thing you learn in law school is you cannot commingle funds and you cannot steal money,” Edelson said. “If you do that, you lose your license and potentially go to jail.”

In 2008 a Lockheed client sued, saying he and others hadn’t gotten their full settlement funds and the firm used the money for its “own individual interest.” In 2012 Girardi Keese was sued by clients who’d been affected by the Northridge earthquake. Girardi had represented them in a suit against an insurance company, and now they were saying the firm had misappropriated their settlement.

In 2014 former clients in the hormone-replacement-therapy case who said they’d developed cancer after using the medications, argued that Girardi Keese had paid itself about $6 million out of their client trust account — without their approval, and before the women got paid. (The Lockheed and Northridge claims were found to be filed outside the statute of limitations; the hormone-replacement-therapy case was settled for a confidential amount.)

That was followed by a 2017 lawsuit by residents of the Carousel tract in Carson, California. They had been clients of Girardi’s in a suit against Shell over secretly abandoning waste oil in their soil, contaminated matter that caused pollution and health problems.

“He was our best friend until he got a large group of people to join the lawsuit, and then we were a nobody,” Barbara Post, the head of the Carousel Tract Homeowners Association, told Insider. “And when it came down to the settlement, and he got the money, things changed.”

After the firm negotiated a $120 million settlement, she said, lawyers stopped returning residents’ calls and didn’t account for where the settlement money went. That suit is on-going.

It was “promise after promise: ‘I’m getting you money, I’ll get it for you this date, I’ll get it for you for this date,” Post said.

Yet it was a series of loans that would undo Girardi.

There’s a concept in plaintiffs’ law known as litigation funding. Plaintiffs’ lawyers are paid only when cases settle or are won, and funding lawsuits up front can get expensive. Girardi Keese’s costs in the Shell suit, for instance, included $162,000 for court-reporter fees, $4.36 million for expert witnesses, and $415,000 in photocopies. Lawyers take out loans from litigation-funding companies against projected future settlements or jury verdicts, promising to pay the litigation funders back from the fees they receive.

Lenders in three separate suits claimed that Girardi took out a $3.5 million loan from a litigation funder, which he increased to $8 million in 2011. A condition of the loan was that he wasn’t supposed to take out any other loans without the funder’s approval. But in 2015, the lawsuits said, Girardi used the same collateral — meaning the same funds from the same future cases — for a different loan from a different company, without alerting the first company.

The next year, he obtained a third loan, from a different company, without disclosing the previous loans, still using the same collateral. “I will personally guarantee the obligation as will Erika,” he wrote in an email included in the lawsuit.

By 2018, Girardi owed $39 million to five companies, all with the same group of cases as collateral, the first funder alleged in its suit. Five times over he had promised his company’s future — in the form of settlements, years from resolution — for a stream of cash. But eventually the lenders decided to collect, and Girardi couldn’t cover his bets.

“I totally, negligently, violated the agreement to repay,” he wrote one lender in a May 2018 letter included in court documents. He soon added the deed on his Pasadena home as additional collateral. He dangled several cases that he expected would resolve soon, highlighting his $250 million financial statement and including several accolades he’d won recently for good measure.

But repeated attempts from the lending firm to contact Girardi didn’t work, the firm said in its suit against the attorney. Girardi just stopped answering phone calls.

Yet one thing he, or Erika, didn’t do was stop showcasing their over-the-top lifestyle.  

Erika may be known for her excessiveness, but she had grown up poor, in Georgia, with a single mother who’d given birth to her in her teens. After high school she moved to New York, and, soon after, she married, had a child, and divorced. Erika went to Los Angeles at 25 to pursue her dreams of becoming an actress. She supported herself as a cocktail server at a restaurant called Chasen’s, where Tom Girardi was a regular. A year or so after they met, Erika slipped Tom her number and they began dating. Within a few months she moved into his Pasadena home, and they were engaged six months later, marrying in 2000.

Erika Jayne performing in Atlantic City, New Jersey, in 2018.Donald Kravitz/Getty Images

She and Girardi didn’t sign a prenup: “Tom was going to protect himself no matter what, and what did I need to protect?” Erika wrote in her autobiography.

After several years of dutifully attending lawyers’ award banquets and “living his life,” as she put it, Erika saw another lawyer’s wife performing in a music video and was inspired to create a persona called Erika Jayne, an over-the-top, leather-clad, hair-whipping dancer-singer. Girardi helped financially.

“The whole Erika Jayne project was only possible because I’m self-funded,” she wrote. “Now, the haters are always going to say, ‘All you do is spend your husband’s money.’ First of all, it’s our money. Know how I know? Because the IRS tells us that it is. My name is on that tax return, too.”

Erika recorded some songs, did some performances, and made some music videos, while still aiding Girardi through tasks like laying out his clothes daily. She was about to give up the side gig when she was cast on “The Real Housewives of Beverly Hills” in 2015.

She now had a platform, and her whole lifestyle backed up the Erika Jayne mythology of money, sex, and brashness — with emphasis on the money. She regularly traveled with an entourage devoted to keeping her camera-ready. She wore Versace and Gucci. She showed off the Pasadena house’s décor that she’d overseen, including a private chapel with frescoes on the vaulted ceilings and gold-brocade walls. She set up a headquarters and clubhouse in Hollywood, replete with a glam room for hair and makeup. She booked “Dancing With the Stars,” partnered with a shoe company, and sold branded merchandise. 

“When you are with someone as smart and aggressive — and some would say Machiavellian — as he is, it’s impossible not to become a student. And I am his best fucking protégée,” she wrote of her husband.

Speculation about Girardi and Erika’s relationship has been circulating since the two met. Was it true love? An arrangement? On “Housewives,” Erika joked about never seeing her husband. Her “Chicago” costar, NaTasha Yvette Williams, said Erika rarely mentioned Girardi, adding that he never saw the show before the coronavirus shut down Broadway, in March 2020.

But while some in Girardi’s legal circle assumed the relationship was “transactional,” as one put it, there seemed to be genuine warmth. At one point on “Housewives,” when Girardi said “I’m really proud of you,” Erika, typically stoic, teared up. “That’s all I ever wanted,” she said. An insider said they spoke on the phone when Bravo cameras weren’t rolling, and Girardi talked about Erika to legal acquaintances incessantly, fellow lawyers said, flipping through pictures of her on his phone and bringing autographed photos to meetings.

Lawyers at the firm, who spoke on condition of anonymity, had long questioned whether Girardi Keese’s funds were going to support Erika’s career. In 2011, Girardi played a provocative video of Erika at a lawyer gathering, described by one attendee as “soft porn.” Others mentioned Erika’s use of Girardi’s Gulfstream, which was supposed to be for business.

In 2019, that question may have been partially answered when the firm routed EJ Global LLC at least $20 million in the form of a loan, a litigation-funding firm claims in a suit filed against Girardi Keese.

As the couple continued to broadcast a life of glitz and success on cable TV, issues piled up, though Girardi didn’t at first seem cowed.

When one of the litigation-finance firms sued him in 2019, Girardi touted his legal connections in a letter to its lawyer and threatened to sue back.

“Four judges called me . . . . Every one of them stated they better not come in his courtroom,” he wrote in a letter included in the suit. Though he was the one who owed the lender money, he threatened to countersue, claiming that the court would likely award him significant punitive damages for the lender’s “fraud and deceit,” and offered $113 million to settle the case. “We will find if I’m a better lawyer or you a better liar,” he wrote. In the end a judge declared that Girardi owed the company $16 million.

Girardi was touted as the “Top Legal Expert Of The Year” in a June 2020 cover story. The cover was used as evidence in a suit against him.Court Documents

In the summer of 2019 the Ruigomez family sued. Girardi had represented them after a poorly maintained PG&E pipeline in San Bruno exploded in 2010, setting the Ruigomez’s house on fire. Joseph Ruigomez, then 19, watched his girlfriend burn to death, and he endured burns on more than 50% of his body. Girardi won a settlement from PG&E. But, according to their suit, the Ruigomezes were not paid the entirety of their funds. The two parties agreed to settle for $12 million in January 2020. To date, the Ruigomezes are still owed $11 million.

In late 2019, a firm handling law administration sued, saying Girardi Keese owed it $12 million. Girardi threatened the firm with a “bizarre” note, the firm claimed, saying that unless they resolved the suit, he’d send a mass letter saying that Girardi Keese discovered inappropriate billing on the company’s part, “an apparent attempt to gain leverage” that was “easily refuted,” the firm said.

But Girardi kept practicing, his California bar membership unmarred by even a single sanction. “I’ve been in the persuasion business for many years,” he said in a January 2020 video, “and that’s all this law stuff is, to persuade.”

When Jay Edelson began working with Girardi in the summer of 2019, he didn’t know about the legal troubles Girardi was having. He knew him by reputation only, as one of the country’s great plaintiffs’ lawyers.

Edelson first met Girardi in 2018 to discuss working on opioid lawsuits together. The two met at Morton’s, where Edelson waited at one reserved table while Girardi finished a meeting one table over. Girardi, he recalled, had a special menu where the point was not necessarily that the food was going to be so much better, but “that it was his menu.” Edelson thought the theatrics were a bit much, but there were things he could learn from Girardi. In 2019, when Girardi Keese asked Edelson to step in on a suit against Boeing, he agreed.

“At the time, our understanding of Girardi’s firm was that they were flush with money, super successful,” Edelson said.

Girardi was suing Boeing on behalf of families of victims of Lion Air 610, the Boeing 737 Max jet that crashed 12 minutes after takeoff from Jakarta, Indonesia.

In February 2020, Boeing and the families settled for a confidential amount. But by April, the victims’ families still hadn’t gotten paid, and no one at Girardi Keese could explain why. “They were being very cagey,” Edelson said.

Edelson pushed senior lawyers at Girardi Keese, who had documentation that Boeing had earlier wired the full amounts, to contact Girardi. In June, David Lira, Girardi’s son-in-law and one of the senior lawyers at the firm, demanded that Girardi pay the Boeing clients, then quit. He has not spoken to his father-in-law since, according to court papers. On July 14, a judge declared Girardi and his firm “insolvent.”

Yet Girardi was still stalling. “The firm has never been more successful,” he wrote to a litigation-funding company the next week, court documents show. He called Edelson’s firm that same day and promised to “figure it out.” A few days, he promised. A few weeks. The money would come. But it didn’t.

“My take on this is that he was running a Ponzi scheme, and that Ponzi scheme fell apart when the court system collapsed because of the pandemic,” Eric Seuthe said. He’s suing Girardi and the firm on behalf of one of Girardi’s former clients, Judy Selberg, who was supposed to receive $500,000 in a wrongful-death settlement after her husband was killed in a boating accident. She received only $50,000, and Girardi Keese increased its commission to 40% from 33% without notifying her, Selberg alleged in her suit. “He could not dig himself out of this situation,” Seuthe added.

Andrew Goodman, a lawyer who filed involuntary bankruptcy proceedings against Girardi and Girardi Keese on behalf of several former clients and employees, seconded the Ponzi-scheme theory, questioning whether some of the misappropriated funds were being routed to Erika.

In November, in the midst of Girardi’s deepening legal turmoil, Erika filed for divorce, citing irreconcilable differences. The timing seemed suspicious: Some lawyers wondered whether it was a ploy to protect her assets.

The divorce filing signaled to Edelson that he needed to act fast. By then Erika was entangled in Girardi’s financial problems: Lawyers for the Ruigomezes had, in August, filed papers seeking to question Erika about the assets and the business activity of her husband, for example.

“I said, ‘Uh oh, this feels like everything could be caving in, and either she’s protecting herself or they’re both protecting other money. That’s when I got really worried,” Edelson said. “This is really starting to feel like a house of cards.”

Girardi Keese lawyer Keith Griffin wrote to his boss in mid-November warning him that the Boeing clients said they would file a criminal complaint with the district attorney’s office if they did not receive their funds by November 30.

Yet around Thanksgiving, Girardi was still asking for leniency. “Don’t be mean to me: Be nice to me,” Girardi said in a voicemail for Edelson. “We screwed up here a little bit,” he said in a voicemail soon after. “This never happened before.”

More clients sued; Girardi offered more excuses. Griffin quit, as had almost all the other Girardi Keese employees. Edelson hurried to file a motion asking for Girardi Keese to be held in contempt in the Lion Air case and a suit against Girardi, Erika, and Girardi Keese, among others. He filed in Illinois, to avoid preferential treatment.

“We were very concerned that he had avoided, really, even disciplinary action for so many years. He was one of the most powerful attorneys in California, and we were very aware of that,” Edelson said.

In early December, the California state bar notified Girardi that he was under investigation. Soon after, in Chicago, a federal judge called a hearing to figure out what happened with the missing $2 million in Lion Air client money.

Erika Jayne (second from right) with fellow “Real Housewives of Beverly Hills” cast members at the season 8 premiere party.Jesse Grant/Bravo/NBCUniversal via Getty Images

A lawyer representing Girardi Keese said Girardi had no ability to pay and “has had issues regarding his mental competence.” Despite Girardi’s claims of mental-health challenges, the judge found Girardi and Girardi Keese in contempt, froze the assets of both, and said he was referring the case to federal prosecutors.

Soon after, one of Girardi’s brothers asked to be named his temporary conservator, a legal role where he’d take over Girardi’s day-to-day life.

“He cannot care for himself without assistance. His short-term memory is severely compromised,” his brother told the court. “Tom does not understand the dire situation and says his money situation will clear up next week.” In March, a doctor hired by Girardi’s brother submitted a report saying that Girardi had Alzheimer’s and dementia.

Yet Girardi seemed to be mentally fit at points in the months leading up to the diagnosis. There was that hourlong October podcast interview during which Girardi outlined his jury-selection tips and talked about how, when he used to travel, people would chat with him about case strategy. Now, “I walk into the same hotel, 20 people come running up: ‘Are you Erika’s husband?'” he chuckled. In November, he moderated a panel on trial strategy. In his conversations with Edelson, he knew what was owed, and to whom, Edelson said.

At the end of January, a court-appointed official interviewed Girardi by phone, finding that while Girardi was indeed having difficulty understanding the proceedings in which his brother would take over as his temporary conservator, he correctly used legal terms and expressed worry about a “media circus.” The California bar, in its own investigation, said that Girardi requested a settlement conference and did not claim diminished mental capacity. His recent actions, a state-bar lawyer wrote in court documents, “belie allegations that Girardi is now incapable of caring for himself.” Girardi’s and Erika’s lawyers did not respond to requests for comment.

While Illinois prosecutors review a possible criminal case against Girardi, it’s up to bankruptcy trustees to figure out what assets are left. “I assume they’re going to look at, very closely, the relationship, especially monetarily, between Girardi and his wife, his former wife,” Goodman said. If EJ Global did receive that $20 million-plus from Girardi Keese, as one lender alleged, and if that money came from client funds or litigation-funding loans, for instance, Erika could face repercussions.

In late March, when the trustee in Girardi’s personal bankruptcy filed a list of what the attorney owed, Erika was listed as co-debtor for personal payments to American Express and the Bel-Air Country Club, but also as co-owing money to Girardi Keese clients including Judy Selberg.

Erika now lives in what is, for her, a relatively modest 2,000-square-foot house in LA. She’s been named in at least five lawsuits against Girardi, and Edelson is seeking her deposition on Girardi’s mental state. In December, when Erika listed her used designer clothes on Vestiaire Collective, a judge instructed her to “act in accordance” with the asset freeze. Arguments over who gets what in the divorce are on hold, as the bankruptcy proceedings override those. In March, after a bankruptcy trustee proposed paying the Ruigomez family about $11 million from assets of Girardi’s estate, Erika objected, arguing she should be able to carve out exemptions from the estate for herself. A hearing is scheduled on that for next month.

“I would imagine she’s very hurt. And I’m sure she’s very scared,” former “Real Housewives” cast member, Adrienne Maloof told Insider. “That’s a very scary thing to go through… This is not a reality show now, this is real life. I’m sure she’s going to protect herself as best she can.”

Meanwhile, Girardi is left to his 10,000-square-foot home, which the bankruptcy trustee is about to put up for sale for $13 million; he’ll have to move out once it’s sold. He still has a housekeeper, a driver, a landscaper, and an assistant, according to a court filing.

California is seeking $5.4 million in unpaid taxes from him, dating to 2011. The state bar’s investigation continues. In March it rendered Girardi’s law license inactive. The Aston Martin, the Mercedes, and the Land Rover have been subsumed into bankruptcy proceedings. According to Girardi’s bankruptcy proceedings, he owes $11,000 to an orchid florist, $134,000 to a car-leasing company, Lamborghini Financial, and nearly $7,000 to a high-end laundry. Girardi is living on $3,000 in monthly Social Security benefits.

Girardi Keese’s assets are being parsed out in bankruptcy court and the firm’s cases handed off to other firms. An LA lawyers’ organization, for which he threw those Jay Leno dinners, recently revoked his awards, saying Girardi violated “the fundamental duties that attorneys owe to their clients, to the court, and to the profession.”

As for his former clients, some are litigating and waiting, hoping to get a portion of what they were due. Others have given up.

“There are people in here who still have not got their money, and they’ll never get it — never get it,” Barbara Post said. “It’s been very, very hard on the residents.”

As LippSmith, the former Girardi Keese lawyer, said of Girardi’s actions: “It’s more despicable than the stuff we pride ourselves on going after every day.”

A well-known lawyer who promised to do right by clients, and then deceived them, it’s the type of case Tom Girardi, at one point in his career, would’ve taken on, and won.

Source: Read Full Article