Girardi denies all charges on last day of federal wire fraud trial

Tom Girardi testified Thursday that he never stole money from clients but did often hold back settlement funds for their own good because they were drug addicts. Under cross-examination, he seemed to agree that the skills he developed as one of California's top trial lawyers would be useful in persuading the jury in his federal fraud trial.

"We'll find out," Girardi said with a smile as he looked at the jurors.

Girardi took the witness stand on the 11th day of trial in Los Angeles on four counts of wire fraud. He is accused of stealing $15 million from clients between 2010 and 2020. He faces a similar criminal case in Chicago where he is accused of stealing millions of dollars from the families of people who died in an airline crash in Indonesia.

"I swear to you ... every client got every penny they were supposed to get," Girardi testified before his defense counsel rested their case. "It's not like I took the money. .... Holdbacks were not for me to take money. I don't even have a salary. I work very hard."

Girardi said he believes his defunct law firm, Girardi Keese, is still open, has "no idea" who's defending him in the wire fraud trial, and said it was important for his firm to hold back funds to certain clients for reasons such as medical liens and requests from the family so money wasn't being spent to feed drug addictions.

Rumors that the disgraced plaintiffs' attorney might take the stand had circulated for a few days, but it was thought to be unlikely. Girardi's defense team has said he has been diagnosed with dementia and Alzheimer's disease and didn't have the mental capacity to knowingly commit the alleged crimes.

Earlier Thursday, the federal defenders told U.S. District Judge Josephine Staton that they had no more witnesses to call, but instead of resting, asked for a break to consult with Girardi. He took the witness stand soon after.

At the start of cross examination, Assistant U.S. Attorney Ali Moghaddas asked Girardi how he was doing.

"That depends. You have to be nice," Girardi said.

"I'm always nice," Moghaddas responded.

Moghaddas then asked Girardi if he had spent his life persuading people as a plaintiffs' attorney. "I don't know. We'll find out," Girardi said with a smile as he looked at the jurors.

Girardi told Moghaddas he "didn't intentionally tell anybody, ever" the wrong settlement amount for funds that were owed to his former clients.

One client in particular, Joseph Ruigomez, was the first witness called by the prosecution at the beginning of the month. He retained Girardi Keese in 2010 in a personal injury case that settled in 2013 for what he believed was $5 million. However, Ruigomez said the true nature of his settlement, $53 million, was not shared with him until much later and it took him over six years - after filing a lawsuit - to recover the money he was due.

Girardi said he did not remember concealing any information from Ruigomez but recalled the client's mother telling him not to distribute the full sum of the settlement to her son because he had a drug addiction that would kill him.

Girardi was confronted with a letter he sent to Ruigomez about why the money was not being sent. One of the reasons Girardi gave at the time was he was waiting for approval from the mediator, which Ruigomez testified was an excuse Girardi would give him for years.

"It's not a story. It's the truth," Girardi said when Moghaddas asked him about the "stories" he told Ruigomez and his family.

The mediator in the case, the late California Supreme Court Justice Edward A. Panelli, was someone Girardi said was "strict to say money had to be spaced out to an 18-year-old with a drug addiction. That's all there is to it."

When Moghaddas pressed Girardi that Ruigomez was not being sent the money because it had already been spent, Girardi responded, "You're wrong."

Moghaddas confronted Girardi about the other three former clients who testified at trial about their missing settlement funds.

However, Girardi said he did not remember the details of their settlement or their testimony. "I wasn't in the courtroom."

Girardi has been sitting in the courtroom every day.

"I do remember this, though. We were given instruction not to give plaintiffs money," Girardi added.

While under direct examination by one of his federal defenders, Samuel O. Cross, Girardi said he remembered one of the clients, Judy Selberg, and her settlement with his firm in June 2020 for $500,000.

Selberg testified that her portion of the original agreement, over $300,000, was never paid to her until she sued him and filed a State Bar action in November 2020. Several letters and voicemails Girardi left for her explaining why her money wasn't being sent were shown to jurors. The reasons included: he was awaiting judge signatures for the check, and he was fighting with the IRS to exempt her from a purported law that he said taxed women in wrongful death cases and not men.

"I was told there was a drug issue. Whatever you do, don't give this person all of this money; otherwise, she'd be dead," Girardi said about Selberg.

Throughout Girardi's 40-minute testimony, he repeated several times that he never intentionally took money from his clients, that he took no salary and worked hard. He spoke lightly and coughed a few times but did not hesitate to respond to questions.

Several times, however, Girardi said during direct testimony that he needed more time to refresh his memory on the matters and he was "not ready for cross."

During redirect, Cross asked Girardi if he knew who he was.

"I have no idea. Bad. Mean. Terrible. I don't know," Girardi said. He was also asked if his firm was still operational.

"Yes," Girardi said.

Moghaddas asked him about the $25 million that was backed by Girardi Keese to EJ Global, the company owned by his wife, the entertainer known professionally as Erika Jayne.

Girardi said it would not be appropriate to use firm money to finance his wife's lifestyle but added, "If there were legitimate business expenses," his firm would be allowed to use that money. "If, in fact, the firm owed me money, I have $48 million in costs from the firm. ... I don't take a salary. I work very hard."

Christopher Kamon, former financial chief at Girardi Keese and severed defendant in the case, is accused by Girardi's counsel of taking advantage of the former attorney's deteriorating health throughout the final decade of his legal career to steal money behind his back. U.S. v. Girardi et al., 2:23-cr-00047 (C.D. Cal., filed Jan. 31, 2023).

Girardi said Kamon "stole a lot of money. Obviously, we didn't know about it."

He recalled Kamon's position at the firm as the guy who "was in charge of accounting" who had "a lot of leeway" and financial responsibilities that Girardi entrusted him with.

"Because the firm was doing well ... there was money there that he would grab that we didn't even know about. He was pretty clever in stealing millions of dollars.

"If I had one clue that this guy in accounting was taking money, I would go crazy. ... I had no idea this guy Kamon was taking things," Girardi said.

While under direct examination, Girardi recalled his early years as a law student and the "wonderful success" he had at Girardi Keese. He was asked about other lawyers who worked at the firm, including his son-in-law, David R. Lira. "He's a terrific lawyer. A great guy. ... We have a family relationship," Girardi said. Lira has been charged in the Chicago case with misappropriating clients' money and is fighting a State Bar case that could lead to disbarment.

Girardi was also asked about his personal secretary of more than 25 years, Shirleen Fujimoto, and referred to her as "the greatest person of all time."

However, when asked if he remembered her half-day long testimony from Wednesday, he responded, "No. I wasn't in the courtroom."

After his testimony, jury instructions were discussed. Closing arguments are set for Monday.