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Feds charge disbarred attorney Tom Girardi with embezzling more than $15 million in client money

A federal grand jury slapped the onetime preeminent plaintiff's attorney with charges related to his representation of the Lion Air crash victims' families.

LOS ANGELES (CN) — Former attorney Tom Girardi has been indicted by a federal grand jury on charges of embezzling more than $15 million of his clients' money, U.S. Department of Justice officials announced Wednesday.

An indictment filed in Los Angeles charges Girardi with five counts of wire fraud. Another indictment, filed in Chicago, charges Girardi with eight counts of wire fraud. Federal prosecutors accuse Girardi of stealing more than $3 million from families of victims in the Lion Air Flight 610 crash, whom Girardi represented. He is also charged with four counts of criminal contempt of court. 

"Mr. Girardi was robbing and stealing from those people he claimed to be championing," said U.S. Attorney Martin Estrada at a press conference Wednesday.

Also named in the Chicago indictment are two Girardi associates: his son-in-law and former partner, David Lira, who is still a practicing attorney in Los Angeles; and the former CFO of Girard's law firm, Christopher Kaman, who was arrested in November and is currently being held in prison without bail.

Girardi was among the most successful, well-connected and powerful plaintiff's attorneys in California, if not the nation. He played a key role in the lawsuit against Pacific Gas & Electric by the residents of Hinkley, California, a case made famous by the film "Erin Brockovich." Girardi later achieved fame when he and his then-wife Erika Jayne were cast on the reality show "Real Housewives of Beverly Hills."

Girardi had been sued numerous times by former clients and lawyers who accused him of taking their money, but he always managed to avoid being disciplined by the state bar where he had deep connections. Finally, an investigation by The Los Angeles Times exposed Girardi's pattern of misappropriating funds from his clients and lying to them about it.

Hounded by creditors, Girardi and his firm declared bankruptcy in 2021. He has since been disbarred, and a psychiatrist has diagnosed him with late-onset Alzheimer’s. When asked if the 83-year-old Girardi's mental state would be an issue in prosecuting him, Estrada said, "We leave it to the court to determine competency issues."

The Los Angeles indictment, filed Tuesday but unsealed on Wednesday, cites five unnamed victims of four alleged acts of fraud. The first act almost surely refers to Joseph Ruigomez, a young man who was severely injured when a PG&E gas line ruptured in San Bruno, California, causing a massive explosion. His girlfriend was killed in the blast, and Ruigomez was left with burns on 90% of his body. Girardi took Ruigomez's case and secured a $53 million settlement from the utility. But he told Ruigomez that the settlement amount was only $7.25 million, and that it would be structured as an annuity, to be paid out slowly over the rest of his life.

In another count, an unnamed couple and their minor child were injured in a car crash. Girardi secured a $17.5 million settlement. He and his firm kept around $15 million.

Girardi's first court appearance is set for Feb. 6. Each count of fraud carries a maximum sentence of 20 years in federal prison.

Categories:Criminal, Law

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