Tom Girardi found guilty of stealing money from clients

LOS ANGELES (CN) — A federal jury convicted former attorney Tom Girardi on four wire fraud counts Tuesday.

Girardi gave little discernible reaction as the verdict was being read. When asked what he thought while coming out of the courtroom, he chuckled and said, “No, no.”

“Tom Girardi took advantage of clients when they were most in need," U.S. Attorney Martin Estrada said during a press conference. “Today’s verdict shows that the game is up — we can all now see this defendant for what he was and the victims he callously betrayed.”

Federal prosecutors accused Girardi of running a Ponzi scheme to steal money from his former clients, using money from new settlements to pay off clients whose money was past due, all the while lying to the newer clients in an effort to keep them at bay. But much of the money also went to fund his lavish lifestyle, one replete with private jets and exclusive country clubs, to say nothing of his wife Erika Jayne’s entertainment career. Eventually, his firm collapsed under the weight of all those creditors.

Girardi’s defense was two-fold. His attorneys argued that he was, at the time of his fraud, suffering from cognitive decline, and was unable to manage his firm’s affairs. He did likely lie, they said, but it was not with the intent to defraud. They also said the true villain in the story was Chris Kamon, the former head of accounting for the law firm, Girardi & Keese, who has also been charged in the case and who is set to go on trial next year.

The 12-day trial featured testimony from each of the four victims in the case: Joe Ruigomez, who was badly burned in a gas line explosion that killed his girlfriend; Judy Selberg, whose husband was killed in a boating accident; Josefina Hernandez, who was injured by a faulty medical device; and Erika Saldana, whose 1-year-old baby was injured in a car crash with a drunk driver.

But the most dramatic day of the trial was when Girardi himself took the stand — the first time he had ever addressed the accusations leveled against him.

“The last thing I would do would be to take someone’s money,” Girardi testified. “I wouldn’t think of it.” He later added: “Every client got every penny that every client was supposed to get.”

Though he spoke coherently, and even managed to exude a degree of avuncular charm, Girardi also claimed to remember nothing of the trial he just sat through and indeed didn’t even know his own lawyer’s name. His long-term memory appeared better, though still flawed.

The jury deliberated for just four hours before reaching a verdict.

“It wasn’t a hard decision,” said one juror, Miguel Lopez. “All the evidence was there.”

Lopez said that based on Girardi’s testimony, he thought the attorney “wasn’t all there,” but he thought the evidence showed Girardi’s mental decline began only recently, after the fraud had occurred.

Girardi was once among the most successful and politically connected plaintiff’s attorneys in California. He helped secure a $333 million settlement on behalf of the residents of Hinkley, who sued Pacific Gas & Electric for contaminating their groundwater — a legal battle that was dramatized in the 2000 film “Erin Brockovich.” Girardi would achieve a more personal fame when Erika Jayne was cast on the reality show “Real Housewives of Beverly Hills.”

Accusations that Girardi was withholding money from clients, co-counsel and litigation lenders dogged the attorney for decades. He faced numerous lawsuits over unpaid debts, yet somehow avoiding punishment either by the courts or the State Bar of California, where he had deep ties. A 2021 investigation by The Los Angeles Times laid out Girardi’s pattern of misappropriating funds from his clients and lying to them about it. That same year, Girardi’s attorney claimed Girardi was suffering from dementia, and he was placed under the conservatorship of his brother.

After he was indicted, Girardi’s team of public defenders claimed he was mentally incompetent to stand trial, but U.S. District Josephine Staton disagreed, writing that his cognitive decline was “not as severe as defendant presents it,” and that he was either feigning or exaggerating his dementia.

Girardi is scheduled to be sentenced on Dec. 6. In the meantime, he will return to his locked mental health care facility in Orange County.

Each wire fraud count carries a potential prison sentence of up to 20 years. Girardi also faces separate charges in federal court in Chicago, stemming from accusations that he withheld settlement money from the family members of people who died in the Lion Air Flight 610 crash of 2018. Kamon and Girardi’s son-in-law, David Lira, are co-defendants in that case.

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