Discovery disputes with bankruptcy trustee may delay Girardi fraud trial

LOS ANGELES — Counsel for disbarred plaintiffs’ attorney Thomas V. Girardi kept open the possibility that discovery disputes may cause a delay of his Los Angeles wire fraud trial because they are sifting through terabytes of documents and butting heads with the Girardi Keese bankruptcy trustee over access to emails that they said contain “critical” financial information.

“This is a case where the movement of money, who was directing the movement of money, and how the money was being spent, is critical. ... We still don’t have full access to that information,” Federal Public Defender Charles J. Snyder told U.S. District Judge Josephine L. Staton during a discovery conference in Los Angeles on Friday.

Elissa D. Miller, a partner at Greenspoon Marder LLP who is the Girardi Keese trustee in bankruptcy court in Los Angeles, did not respond to an email or phone call Friday. An automated reply from Miller’s email account responded: “I am on jury duty and will only be reviewing emails on breaks.”

However, Miller’s attorney, Raines Feldman Littrell LLP partner Kyra E. Andrassy, said in an email: “The trustee is being cooperative and in the process of producing documents pursuant to the subpoena she received.”

Snyder told Staton that Miller was served with a subpoena on Feb. 13.

Through a joint status report filed to the court on Feb. 16, Snyder stated Miller “refused to produce anything without a subpoena,” which he wrote put a barrier on the review of “critical” evidence to Girardi’s defense.

During the hearing, Snyder told Staton that since Jan. 10, he went back and forth with Miller through emails and a phone call in an attempt to obtain the information voluntarily, which he said she wouldn’t do.

Assistant U.S. Attorney Scott Paetty told Staton the defense first contacted him and his co-counsel, Ali Moghaddas, about obtaining the emails. “That’s something that we just didn’t have,” he said. “We had a forensic copy, but it was pretty much inaccessible. … So getting it from the source, the trustee, was the fastest way.”

However, Paetty did not seem satisfied that the subpoena was issued just a week ago. “I understand counsel was working very diligently, but you still had this, kind of, time lag that we were very clear from the beginning that this is the fastest way to do it. Then it was done the other way,” he told Staton.

Snyder responded, “The idea that there’s been some kind of delay on our end, we reject.” He then explained to Staton that since he and Federal Public Defender Samuel O. Cross replaced former Federal Public Defender Craig Harbough on Jan. 10, he had been juggling multiple cases on top of an “excess of diligence” to catch up with Girardi’s discovery, he said.

In addition to the emails, Snyder also said the defense is still sifting through nearly 700,000 pages of documents, which he said include the firm’s accounting and timekeeping records.

Snyder also revealed that the defense recently gained access to some 2.3 terabytes of data that he said was extracted from digital devices that belonged to the firm’s former financial officer and co-defendant in the case, Christopher Kamon.

Although Snyder told Staton the defense didn’t “have any active disputes that we’re asking the court to weigh in on at this time,” Staton inferred he was suggesting otherwise.

“What I’m anticipating, and tell me if I’m wrong, is that you’re sort of setting up an argument as to why you’re going to ask for another continuance because you’re telling me about all these things that you still have to review,” Staton said.

Referring to the situation with the trustee, Staton added, “If you think it is impeding your ability to get documents timely, bring it up now … but I haven’t come to any decision yet because it’s not really been placed in front of me in any fashion that I can move on or make a decision on.

“It looks like a dispute that may create some issue that is going to arise that’s unavoidable. To the extent that that’s the case, I’m just saying we should handle this sooner rather than later,” she said.

Staton scheduled the trial to begin May 21.

In January, Staton found Girardi to be feigning the severity of his 2021 dementia diagnosis and ruled he was competent to stand trial on five wire fraud charges stemming from allegations he stole $15 million in settlement funds from five clients. United States. v. Girardi et al., 23-cr-00047 (C.D. Cal., filed Jan. 31, 2023).

Kamon, Girardi and his son-in-law, David R. Lira of Engstrom Lipscomb & Lack, also face similar charges in the Northern District of Illinois where trial is scheduled for March 2025. The Chicago indictment relates to allegations that they misappropriated more than $3 million in settlement funds intended for victims of a 2018 Boeing air crash in Indonesia. United States. v. Girardi et al., 23-cr-00054 (N.D. Ill., filed Feb. 1, 2023).

However, U.S. District Judge Mary M. Rowland in Chicago said the trial for Girardi will be scheduled at a later date as she mulls the possibility of a second competency hearing.