(Photo by Drew Angerer/Getty Images)
Rudy Giuliani’s having a rough ride in bankruptcy court as he tries to avoid cashing the $148 million check his mouth wrote to Atlanta poll workers Ruby Freeman and Shaye Moss. It seems he’s committed to doing the full “Alex Jones,” only faster and with even less success.
Like the spittle-flecked podcaster, America’s erstwhile mayor filed for bankruptcy as a means of discharging a massive defamation judgment. His goal appears to have been to stave off collections by Freeman-Moss pending appeal, but without the need to post a supersedeas bond. US Bankruptcy Judge Sean Lane had other plans, though, and he barred Giuliani from pursuing that appeal while his Chapter 11 reorganization was underway.
Moreover, it does not appear to have occurred to Giuliani that he’d have to open up his books to his creditors and file accurate reports of his assets and earnings. Nor does he seem to have grokked that continuing to funnel all his earnings through his “alter-ego” companies and making cash withdrawals at random intervals after paying his girlfriend and her daughter a salary, might provoke ire from his creditors.
Like the Sandy Hook parents did with Alex Jones, Freeman and Moss plan to file a petition to declare the $148 million debt non-dischargeable as an intentional tort. (Giuliani has stipulated to multiple extensions of the deadline to file such a petition in light of his own failure to file timely financial disclosures.) And the creditors committee recently moved to have a Chapter 11 Trustee appointed, citing Giuliani’s utter failure to comply with his disclosure requirements, as well as his failure to protect estate assets.
In response, Giuliani — like Jones — filed a petition expressing his “wish” to convert his personal bankruptcy to a Chapter 7 liquidation. Although Jones had a lawyer file his paperwork, and Rudy signed his own filing. Also, Jones managed to get the case number right in the caption.
The creditors hit the roof.
“Unfortunately for the Debtor, this bankruptcy case is not a Disney movie, and the Debtor’s wish is not this Court’s command,” the committee wrote in an objection filed yesterday, demanding that Judge Lane reject the conversion petition and force Giuliani to stay in Chapter 11, under the thumb of both the committee and a trustee.
Since day one, Giuliani has regarded this case and the bankruptcy process as a joke, hiding behind the façade of an elderly, doddering man who cannot even remember the address for his second multimillion dollar home and claims impending homelessness if he must sell that second multimillion dollar home. In reality, Giuliani has treated this Court, the bankruptcy process and the Committee the same way he treated the D.C. District Court and the Freeman Plaintiffs in the Freeman Litigation, with utter disrespect and without accountability.
Freeman and Moss went even further in a separately filed objection.
“[W]hile there is no dispute between the Freeman Plaintiffs and the Committee that the status quo can no longer continue, the Freeman Plaintiffs now believe that dismissal is warranted,” they argued. “Enough is enough. Mr. Giuliani should no longer benefit from the protections of the Bankruptcy Code solely to thwart the Freeman Plaintiffs. The Court should dismiss this chapter 11 case outright.”
“Conversion would merely reward atrocious behavior,” they continued, noting that conversion would dissolve the committee and its efforts to trace Rudy’s assets, while conveniently disappearing the reporting requirements he’s flouted.
And they point out that dismissing the case would finally allow Giuliani to pursue the appeal of that judgment that he’s been clamoring for all year. Of course, if he hopes to block collections while he explains to the DC Circuit how Judge Beryl Howell doesn’t understand the law, he’ll have to get someone to underwrite his bond and then come up with several million dollars in cash to fund it. But that is a problem for another day.
The hearing on Giuliani’s conversion petition is tomorrow morning at 11. Fingers crossed that the creditor represents himself!
In re Rudolph Giuliani [Bankruptcy Docket via Court Listener]
Liz Dye lives in Baltimore where she produces the Law and Chaos substack and podcast.