Thomas V. Girardi, once a premier personal injury attorney, is under a conservatorship, is no longer practicing law, is facing disbarment, is in bankruptcy, and his being divorced by his trophy wife, actress/singer Erika Jayne. His reputation is irredeemable based on litigation in which it is claimed that he and his firm stole millions of dollars in clients’ settlement funds.
Girardi, 82, has moved from his Pasadena mansion into an assisted living facility.
He was relegated to involuntary inactive status by the State Bar on March 9. Disciplinary charges were filed against him on March 30 alleging 14 counts involving the large-scale cheating of clients.
His ability to pay damages is in doubt. Girardi now professes a lack of assets, saying in court papers last year:
“At one point I had about $80 million or $50 million in cash. That’s all gone. I don’t have any money.”
The trustee in the bankruptcy of Girardi’s dissolved law firm, Girardi | Keese, is seeking $25 million from Jayne, asserting she knew that funds for gifts and “glam” services lavished on her were derived from settlements stolen from her husband’s clients.
Girardi and his firm represented four sets of plaintiffs—families, including minors—in multidistrict litigation in In Re: Lion Air Flight JT 610 Crash, assigned to the U.S. District Court for the Northern District of Illinois. The case stemmed from a plane crash on Oct. 29, 2018, causing the death of all 189 persons who were aboard. A settlement was reached. In violation of court orders to electronically disburse settlement funds that were in his client trust account (“CTA”), Girardi held onto $2 million of the funds. According to the State Bar complaint:
“On or about September 3, 2020, the balance in respondent’s CTA was $239,396.25. On or about December 4, 2020, before respondent had disbursed any portion of the $2,000,000.00 from respondent’s CTA to, or on behalf of the minor plaintiffs, the balance in respondent’s CTA was $14,384.85.”
On Dec. 14, 2020, U.S. District Court Judge Thomas Durkin of the Northern District of Illinois found Girardi in contempt for violating his orders, directed entry of a $2 million judgment against him, and ordered that his assets be frozen.
The judge said of the plaintiffs:
“These are widows and orphans. Half a million dollars for any one of these families is a significant amount of money. Life changing, given the tragedy they went through.”
A Dec. 2, 2020 class action alleges that Girardi and Jayne embezzled the money to fund their “outrageous lifestyles…in the glitz-and-glam world of Hollywood and Beverly Hills.”
It is also alleged by the State Bar that Girardi “willfully and intentionally misappropriated at least $269,759.70” of a $504,400 settlement of a client’s suit for the wrongful death of her husband.
It has emerged that a State Bar Court prosecutor, Dale Nowicki, who reported to a supervisor in the office who was overseeing the disciplinary proceedings against one-time prominent trial lawyer Tom Girardi, had a clandestine professional relationship for more than a year with Girardi’s son-in-law, attorney David Lira.
The matter throws the spotlight, anew, on the State Bar’s laxity though the years in dealing with Girardi.
The State Bar said it did not know of Nowicki’s moonlighting as a lawyer, noting that it was not reported to it, in violation of a policy. <
Nowicki resigned from his State Bar post on Oct. 4.
Lira, formerly a member of the firm of Girardi|Keese—which is now shut down—is presently with Engstrom, Lipscomb & Lack. The “Lack” in that firm is its managing partner, Walter Lack, with whom Girardi, while still practicing law, teamed in representing clients in court, with Girardi providing the theatrics and Lack understanding the legal aspects.
The State Bar has said that Nowicki did not have any involvement with the proceedings against Girardi. However, a scandal based on Girardi’s misappropriation of client funds, has spawned attention to the lawyer’s coziness with other State Bar personnel—primarily Tom Layton who, while only an investigator, wielded considerable influence as a Girardi lieutenant.
The Los Angeles Times, in a July 13 article by Harriet Ryan and Matt Hamilton, reported:
“As an investigator for the State Bar of California, Tom Layton was responsible for policing the legal profession for rogue attorneys.
“But while collecting a salary as a watchdog for the public, Layton spent work hours advancing the interests and political connections of a lawyer with a long record of misconduct complaints: the now-disgraced trial attorney Tom Girardi, emails obtained by the Los Angeles Times show.
“During years when clients accused the attorney of stealing from them, Layton, the most high-profile investigator at the agency, was arranging dinner dates for Girardi with civic elites, such as then-Los Angeles Police Chief Charlie Beck and billionaire developer Ed Roski, and otherwise acting as his personal assistant, political operative and, at times, chauffeur, according to the emails.”
Girardi was purportedly exonerated in 2010 of misconduct allegations by outside counsel, appointed by the State Bar, while a partner in his firm, Howard Miller, was State Bar president. Disciplinary charges were not brought.
That decision came notwithstanding a July 13, 2010 determination by a three-judge panel of the Ninth Circuit that Girardi, as well as Lack and a junior associate in Lack’s firm, “attempted to enforce a putative foreign judgment for $489 million in district court but failed” and, in appealing, put forth a document which they knew, by then, was “spurious.” Miller’s name appeared on the pleadings in question.
The Ninth Circuit panel said that “[a]s early as January 2003, respondents Lack and Girardi were aware that the Nicaraguan Judgment named the wrong defendant and that the discrepancy could doom any enforcement action in American courts.”
Girardi disclaimed knowledge of the matter. The panel made note of “Girardi's practice of authorizing the Lack firm to sign his name on briefs that turned out to contain falsehoods,” and said that his “proven conduct is at most reckless,” imposing on him a $125,000 sanction.
The State Bar admitted in July that an internal review “revealed mistakes made in some investigations over the many decades of Mr. Girardi’s career going back some 40 years and spanning the tenure of many Chief Trial Counsels.”
It did not elaborate.
With the current focus on the State Bar’s disciplinary system, the question is presented whether other high-profile attorneys who were subjects of publicly aired allegations of misconduct—such as the late Neil Papiano and former Los Angeles County Bar Association President Paul Kiesel—escaped State Bar actions based on their prominence and clout.
