Giuliani Bankruptcy Nears Turning Point as Judge Rues Slow Pace

The judge overseeing Rudolph Giuliani’s bankruptcy rejected his latest challenge to a $148 million defamation judgment, admonishing the former New York mayor’s lawyers about the lack of progress in the Chapter 11 proceeding.

“I am disturbed about the status of this case,” Judge Sean H. Lane of the US Bankruptcy Court for the Southern District of New York said at a hearing Tuesday.

The judge’s frustration could lead to a major change of direction in the bankruptcy, which has been tumultuous from the start. It’s encountered more trouble recently, as Giuliani has missed deadlines to file mandatory financial disclosures.

His lawyer, Heath Berger of Berger Fischoff Shumer Wexler & Goodman LLP, said Tuesday that his legal team has had issues getting information from him for the financial reports.

Lawyers for Giuliani’s creditors on Tuesday raised the prospect of getting a trustee to take over the case, or even asking for it to be dismissed—suggestions they’ve proposed previously.

At Tuesday’s hearing, Lane refused to let Giuliani appeal the judgment awarded to two Georgia poll workers he falsely accused of rigging 2020 presidential election results.

“I see it as an impediment to progress in the bankruptcy,” Lane said of Giuliani’s request to pursue an appeal.

Giuliani’s lawyers have focused on getting the judgment, which is by far his biggest debt, reduced or eliminated. But that focus has come at the expense of progress in other elements of his case, Lane and the creditors’ lawyers suggested at the Tuesday hearing.

Rachel Strickland of Willkie Farr & Gallagher LLP argued on behalf of the Georgia poll workers that an appeal could delay the bankruptcy case indefinitely. Giuliani hasn’t yet sold his apartments and his lawyers haven’t reached out about settling the $148 million judgment that prompted the Chapter 11 filing, Strickland said.

Giuliani made more defamatory comments about the election workers on his radio show last week, they said. The radio station suspended him shortly after.

“It shouldn’t be a fat cat sitting in two different apartments defaming people into a microphone,” Strickland said.

Concerns over the lack of progress in the case were echoed by the Justice Department’s bankruptcy watchdog, the US Trustee. Giuliani’s lawyers have told the US Trustee that they’ve had trouble getting in touch with their client.

“There has not been much activity in terms of reorganization,” Andrea Schwartz, of the US Trustee’s Office, said.

Lane didn’t rule on Giuliani’s recent request to hire special litigation counsel in light of his decision not to let the appeal move forward.

Willkie Farr & Gallagher LLP, Dubose Miller LLC and United to Protect Democracy represent the poll workers. Akin Gump Strauss Hauer & Feld LLP represents the committee. Berger Fischoff Shumer Wexler & Goodman LLP represents Giuliani.

The case is Rudolph W. Giuliani, Bankr. S.D.N.Y., No. 23-12055-shl, 5/14/24.