Jurors delivered their verdict Tuesday morning in the trial of Tom Girardi, a former top Los Angeles lawyer accused of running a Ponzi scheme over a decade and defrauding clients out of millions of dollars in settlements.
Girardi, 85, was convicted of four counts of wire fraud for embezzling at least $15 million from four clients, some of whom were seriously injured or lost loved ones during the crimes. During his trial, prosecutors alleged that Girardi used the stolen money for private jets and jewelry, and lived a lavish lifestyle in a sprawling Pasadena mansion as depicted on the reality TV show “The Real Housewives of Beverly Hills.” The show stars Girardi's estranged wife, Erika Girardi, who performs as pop singer Erika Jayne.
In 2021, allegations against the former personal injury lawyer were the focus of the Hulu documentary series “The Housewife and the Hustler.” He was disbarred from the bar in 2022.
Tom Girardi AP Photo/Damien Dvarganes, File
“Tom Girardi lured victims with his celebrity status, falsely portraying himself as a 'champion of justice,'” U.S. Attorney Martin Estrada said in a statement announcing Girardi's guilty plea. “In reality, he was a reverse Robin Hood, stealing from people in need to support his lavish Hollywood lifestyle.”
Federal prosecutors allege that Girardi embezzled millions of dollars from clients between October 2010 and late 2020. Among the victims Girardi stole from, prosecutors said, were family members of the victims of the Lion Air crash in October 2018, which killed 189 people. The tragic crash was the first of two crashes involving a Boeing 737 Max 8 aircraft within just five months of each other.
By the end of 2020, Girardi's companies were facing worsening financial problems that ultimately forced him into bankruptcy, according to prosecutors.
Mr. Girardi has long denied the allegations. Federal public defender Charles Snyder, who represents him, has argued that Mr. Girardi's cognitive impairment worsened after he was diagnosed with dementia and late-onset Alzheimer's disease. Mr. Snyder also said that employees of Mr. Girardi's now-shuttered law firm, Girardi Keith & Co., “randomly” stole the funds.
Snyder said Girardi had become “old, ill and insane” and was not paying enough attention to running the company.
But federal prosecutors allege that Girardi's fraud against his clients was intentional.
“The defendant wanted the outside world to believe he was fighting for people who could not help themselves,” Assistant U.S. Attorney Ali Moghadas said during closing arguments Monday.
But customers continued to wait for the money to be deposited, and then “days turned into months and months turned into years,” Moghaddas said.
Estrada said Tuesday that Girardi could face up to 80 years in prison when he is sentenced Dec. 6, but that the court will consider several factors. Girardi currently lives in a nursing home in Orange County.
“We're not going to prejudge it,” Estrada said. “We're going to look at all the facts that come in.”
But Estrada said he could not rule out prison time.
“But the mere fact that he is older, a senior citizen, does not mean we will not seek prison time,” he said.
“He portrayed himself as a champion of the underdog.”
In 1996, Girardi was one of the lawyers representing the small desert town of Hinckley in San Bernardino County in a water contamination lawsuit against the utility company Pacific Gas & Electric that blamed the chemical chromium for cancer and other illnesses suffered by its residents.
Pacific Gas & Electric Co. agreed to pay $333 million to hundreds of plaintiffs in a settlement that was made famous in the 2000 film “Erin Brockovich,” starring Julia Roberts. At the time, the Los Angeles Times reported that Girardi hailed the settlement as “a great moment in history when a wrong was righted.”
The personal injury lawyer has also won multimillion-dollar settlements in other high-profile cases, building a reputation as a giant in the Los Angeles legal community.
Families mourn after police hand over the bodies of their relatives killed in the Lion Air Flight JT610 crash to the police hospital in Jakarta, Indonesia, November 4, 2018. Indonesian authorities said Sunday they had identified seven more victims of Lion Air Flight 610. All 189 passengers and crew on board the Boeing 737 are believed to have died when the plane crashed into the Java Sea shortly after takeoff, and investigators and agencies from around the world have been searching for the victims and a cockpit voice recorder that may solve the mystery for the past week. Getty Images
“Mr. Girardi portrayed himself as a defender of the underdog,” Estrada told reporters at a news conference after the guilty verdict. “He marketed himself as Erin Brockovich's lawyer.”
Estrada said the now-disbarred lawyer “has built an image as a lawyer who fights corporate greed.” But that reputation was called into question when an episode of “The Housewives and the Hustlers” aired in 2021 featuring client complaints against him, including from families of victims of the 2018 Lion Air crash. They alleged that Girardi and two colleagues from the now-disbanded firm embezzled more than $3 million in settlement money.
Girardi was indicted on federal charges last year in connection with those allegations.
“The significant misappropriation alleged in this indictment deepens the grief and anguish of our clients who lost loved ones in the Lion Air crash,” U.S. Attorney John Rausch said at the time.
The lavish lifestyle seen on “Real Housewives”
When Lion Air victims began asking Girardi where their money was in May 2020, he tried to silence them, according to an indictment filed by federal prosecutors last year. “I think you'll fall in love with me in 30 days,” he wrote to one customer at the time, prosecutors said.
A few months later, in December, Jay Edelson, an attorney who had worked with Girardi on representing Lion Air victims, sued Girardi, saying in court documents that Girardi had re-victimized people he had represented in wrongful death lawsuits.
“I don't know what a celebrity lawyer and his celebrity wife spend their money on. It's really hard to understand,” Edelson said.
Erika Jayne attends the Homeless Not Toothless Hollywood Gala at The Beverly Hilton in Beverly Hills, California on April 22, 2023. Jesse Grant/Getty Images, Homeless Not Toothless
The allegations against Girardi came to light the following year when “The Housewife and the Hustler” aired in the summer of 2021. By that point, Girardi had already been dealing with legal troubles related to a decade of stealing from clients, which had forced him into bankruptcy and disbarred him from practicing law, according to prosecutors.
The allegations against him quickly surfaced in a reality TV appearance by his now-estranged wife, Erika Jayne (whose pop music career prosecutors say was funded with money Girardi defrauded from his clients), who shows off her designer clothes, jewelry, sports cars and luxury homes with her co-stars on Bravo TV's “Real Housewives of Beverly Hills.”
She eventually filed for divorce from Girardi.
“Obviously, he lived a very lavish lifestyle,” Estrada said Tuesday. “You only have to watch a little bit of TV to know how lavish he was.”
Just two months after the documentary was released, Mr. Girardi auctioned off prized possessions from his Wilshire Boulevard law firm, including his Los Angeles Lakers championship ring, more than 100 bottles of wine and a framed receipt for his 1996 $1 million settlement in the Hinkley Water Lawsuit.
A federal judge ruled Girardi competent to stand trial in January. After a 13-day trial, a jury found him guilty of four counts of wire fraud, each of which carries a maximum possible prison term of 20 years, prosecutors said.
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Marissa Wentzke
