Girardi’s wife must face lawsuit in Illinois

The wife of suspended plaintiffs' attorney Thomas V. Girardi must face claims in a federal court in Illinois that she and her companies received proceeds from the settlement of lawsuits over a plane crash in Indonesia, a judge ruled Tuesday.

U.S. Bankruptcy Judge Barry Russell of Los Angeles granted a motion by a Chicago law firm for relief from a stay blocking its claims against Erika Girardi, a celebrity best known for her role on the Bravo TV series, "The Real Housewives of Beverly Hills."

"Why should I not allow them to do it?" Russell asked Evan C. Borges, Erika Girardi's attorney, of the prospect of fighting a lawsuit in Chicago. "If you have grounds to challenge it, you can file it there."

Borges, a partner with Greenberg Gross LLP, opposed the request by Edelson PC to remove the stay. In re: Thomas V. Girardi, 20-BK-21020 (C.D. Bankruptcy Ct., filed Dec. 18, 2020). He said the claims against his client should remain on hold because the federal lawsuit in Chicago is based on an "unethical, unenforceable and illegal fee-sharing agreement between Edelson and Girardi Keese," according to a court filing.

During the hearing, Borges argued the fee-splitting arrangement between the firms in a class action against Boeing Co. would raise ethical issues.

But Borges' objection was undercut last week when the trustee handling the Girardi Keese law firm bankruptcy, who first sided with the objection, abruptly withdrew her opposition.

Elissa D. Miller, a partner with SulmeyerKupetz who is a trustee for the Girardi Keese estate, also removed special litigation counsel Ronald N. Richards -- who backed Borges -- and replaced him with Larry W. Gabriel, a Jenkins Mulligan & Gabriel LLP partner.

Miller's abrupt about-face followed a day after an Edelson filing that accused Richards of coordinating the trustee's efforts with Borges.

Russell made it clear during Tuesday's hearing that any objections to allowing Edelson's firm to pursue claims against Erika Girardi were not his concern and would need to be raised with U.S. District Judge Matthew F. Kennelly in Chicago.

The trustee handling Thomas Girardi's bankruptcy -- Jason M. Rund, a partner at Sheridan & Rund PC -- also did not object to allowing the Edelson firm to pursue any assets of Erika Girardi's as long as they do not belong to the estates. Edelson's lawsuit against Erika Girardi and companies she controls has been stayed while the bankruptcy case has played out. Edelson PC v. Girardi et al., 20-CV-07115 (N.D. Ill., filed Dec. 2, 2020).

Complaints have proceeded against two former Girardi Keese attorneys, David R. Lira, Girardi's son-in-law, and Keith D. Griffin. Those lawyers also face contempt proceedings in the underlying Boeing case.

J. Eli Wade-Scott, an Edelson partner, said during Tuesday's hearing that Erika Girardi would join them as a defendant in the firm's lawsuit.

"We intend to proceed against Erika Girardi," he told the judge.

Russell didn't want to hear Wade-Scott defend his firm's conduct, saying he wanted to stay out of it. "I don't have any impression anyone did anything wrong, including your firm," the judge said.