LOS ANGELES (CN) — The trial of disgraced attorney Tom Girardi, who is accused of stealing more than $15 million from clients, began on Tuesday in Downtown LA's federal courthouse.
Assistant U.S. District Attorney Scott Paetty told the jury that Girardi had treated money from settlements "like a personal piggy bank," spending it on private jets and other luxury items, as well as $20 million "to fund the entertainment career of his former wife," Erika Jayne, a cast member on The Real Housewives of Beverly Hills.
Girardi's lawyer, Sam Cross, a federal public defender, said in his opening statement that the real story was that "Tom got old. He started to lose a step — or more than a step." He said that far from being the villain in the story, Girardi was the victim. The real perpetrator, he said, was the law firm's chief accountant, Christopher Kamon, who is Girardi's codefendant, set to go on trial next year. Kamon, Cross said, had somehow managed to embezzle more than $50 million from Girardi's firm during a 10-year span.
Girardi was once among the most prominent and successful plaintiffs attorneys in California — he played a pivotal role in securing a $460 million settlement, in 1996, on behalf of residents of Hinkley, California, who were suing Pacific Gas & Electric, events that were later dramatized in the film "Erin Brockovich." He took on numerous corporations, insurance companies and utility companies, winning billions of dollars for his clients. As the years went on, he gathered political clout, advising three different governors on judicial nominees, and developing deep ties within the State Bar. He also became famous, to a certain degree, when Erika Jayne, a former cocktail waitress, became a reality television star.
His career imploded, in breathtaking fashion, in 2020, after he was accused of stealing money from clients who were suing over a 2018 airplane crash. That allegation is the subject of separate criminal charges in federal court in Chicago.
The charges being heard in Los Angeles stem from four other cases, including that of Joseph Ruigomez, a young man who was severely injured when a PG&E gas line ruptured and caused a massive explosion. Girardi secured a $53 million settlement from the utility, but, according to prosecutors, he told the Ruigomez family that the 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.
"They gave him their case, and they gave him their trust," Paetty said during his opening remarks. "And he violated that trust. He stole millions of dollars in settlement money."
Ruigomez and his mother are expected to be the first two witnesses called by the prosecution.
Each of the four counts of felony wire fraud carries a maximum sentence of 20 years in prison.
Defense attorneys had tried to get Girardi declared mentally incompetent to stand trial, arguing that the 85-year-old is suffering from dementia and is "incompetent to properly assist in his defense," as they wrote in a brief last year. In January, U.S. District Judge Josephine Staton agreed with prosectors that Girardi was "exaggerating his symptoms and partially malingering," and was "able to understand the nature and consequences of the proceedings against him and to assist properly in his defense" — though she did agree that Girardi was suffering "from a mild-to-moderate cognitive impairment."
On Monday, Girardi's legal team, comprising three federal public defenders, filed a brief reiterating their belief that Girardi is incompetent to stand trial, adding that new evidence unearthed in discover shows that he became impaired before his legal troubles began, which, if true, will likely be a key part of the defense.
In his opening statement, Cross compared Girardi to an old relative who starts by losing his car keys, repeating himself and forgetting things. After a 2017 car accident, he said, the attorney started to "go downhill." Cross described Girardi's firm, Girardi & Keese, of which he was the sole owner, as "chaos" — a word he repeated more than half a dozen times. The firm had more than $1 billion going in and out over a 10-year span. Girardi would receive 300 emails a day and have them printed out by assistants. He would have a stack of more than 100 checks to sign. The firm had 175 different bank accounts. It was too much for him to keep track of. At one point, Girardi fell "victim to a bizarre elder abuse scheme," Cross said, without elaborating much further.
Kamon, meanwhile, managed to bring down the firm with his audacious thievery — "death by 1,000 cuts," Cross called it. He created shell companies run by friends of his that billed different cases. Kamon arranged for the firm to pay his driver $25,000, from which he received a substantial kickback. Kamon had a second job at a firm called Lawyers for Justice, which also billed Girardi cases.
Girardi, Cross said, "was an old man whose mind was not what it was ... and Chris Kamon took everything from him."
The prosecutor, Scott Paetty, said that Girardi's scheme never would have worked without people helping him, and that Kamon was also stealing money. But, he added, "Kamon did not lie to clients, like the defendant did."
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