Rudy Giuliani’s bankruptcy case thrown out by US judge

Rudy Giuliani, Donald Trump's former personal lawyer. Photo / Doug Mills, the New York Times

Former New York mayor Rudy Giuliani can no longer use bankruptcy proceedings to avoid a US$148 million ($241m) judgment for defaming two United States election workers after a judge threw out his case, clearing the way for them to pursue the homes and earnings of the one-time lawyer to Donald Trump.

In his order on Friday local time, Judge Sean Lane said Giuliani had “failed to provide an accurate and complete picture of his financial affairs in the six months that this case has been pending” and had “not even retained an accountant, which is the most rudimentary of steps”.

The 80-year-old filed for chapter 11 protection in December, after being found liable for spreading a conspiracy theory about a mother and daughter who counted votes in Georgia during the 2020 presidential election, leading to angry mobs gathering outside their home.

Lawyers for Ruby Freeman and Wandrea “Shaye” Moss had argued earlier in the week that Giuliani was using the bankruptcy as a “pause button on his woes”, and was trying to “thwart” creditors’ multiple attempts to collect.

Judge Lane agreed that there had been a “troubling” lack of financial transparency, citing Giuliani’s failure to disclose that he had a contract for an upcoming book, and that he received “at least US$15,000 per month for hosting a radio show on WABC and between US$100,000 and US$150,000 from his work hosting a podcast called America’s Mayor Live”.

His order also barred Giuliani from refiling for bankruptcy within a year.

A lawyer for Freeman and Moss, Rachel Strickland, said her clients had “already waited too long for justice” and were “pleased the court saw through Mr Giuliani’s games”. She added that the duo’s legal team would begin enforcing the judgment against Giuliani “ASAP”.

Giuliani, in a surprising move, did not oppose the dismissal of the bankruptcy case. A spokesperson said he had been subjected to “voluminous and overly broad discovery requests ... intended to harm the mayor and destroy his businesses”. He added: “we are confident that — in the long run — our system of justice will be restored and the mayor will be totally vindicated”.

Giuliani, who was former US President Donald Trump’s personal lawyer during and after the 2020 presidential election, is also facing criminal charges over alleged election interference in Georgia and Arizona. He has pleaded not guilty in both criminal cases and is appealing against the defamation judgment.

In a filing ahead of the decision, lawyers for other creditors, including a woman who has sued Giuliani over an alleged sexual assault, said he had treated the bankruptcy process as a “joke”.

He was “hiding behind the facade of an elderly, doddering man who cannot even remember the address for his second multimillion-dollar home and claims impending homelessness if he must sell that [home]”, they added.

Giuliani, who once owned several properties, has an apartment on Manhattan’s Upper East Side, and a condominium in Florida’s Palm Beach. His lawyers said the assets, along with “some jewellery perhaps” would yield about US$8m. Giuliani had previously reported assets of US$10.6m.

A former US Attorney for the Southern District of New York, Giuliani had his legal licence in the state revoked this month. His lawyers argued he would have limited earning power as an “80-year-old disbarred attorney”.

Strickland disagreed, saying that “when Mr Giuliani is working for himself ... he will be hustling for Rudy Coffee and a podcast and all the rest of his moneymaking endeavours”. Giuliani launched a coffee brand earlier this year, with the slogan “fighting for justice”.

By avoiding high legal fees, “creditors will be able to hold ‘America’s Mayor’ accountable for the harms he has caused”, Strickland added.

Besides the US$148m owed to Freeman and Moss, Giuliani has revealed that he has almost US$1m in unpaid taxes, as well as hundreds of thousands of dollars worth of unpaid legal fees. He is also being sued by voting technology companies Dominion and Smartmatic.

During the bankruptcy proceedings, Giuliani had made dozens of Amazon purchases, buying a tripod apparently for his podcast, an extra-extra-large “Men’s Active Performance Tech T-shirt”, and a bottle of “tanning moisturiser”, according to court filings.

Written by: Joe Miller

© Financial Times