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Rudy Giuliani files for Chapter 11 bankruptcy in New York after defamation case

correction

A previous version of this article incorrectly stated the value of Giuliani’s assets listed in the filing was around $10 million. The value is between $1 million and $10 million. The article has been corrected.

Rudy Giuliani has filed for Chapter 11 bankruptcy in New York, one day after a federal judge ruled that he must immediately pay the $148 million he owes two Georgia women he falsely accused of helping to steal the 2020 election.

In paperwork filed Thursday to seek protection from New York creditors, Giuliani listed nearly $500 million in debts, including the $148 million he owes former Georgia election workers Ruby Freeman and Wandrea ArShaye “Shaye” Moss. He also listed “unknown” amounts of debt to election technology companies Smartmatic and Dominion Voting Systems, which named the former New York mayor in their defamation lawsuits about the 2020 presidential election. He listed his assets at more than $1 million but less than $10 million.

“The filing should be a surprise to no one,” Ted Goodman, a political adviser to Giuliani, said in a statement. “No person could have reasonably believed that Mayor Rudy Giuliani would be able to pay such a high punitive amount.”

Goodman said the Chapter 11 filing would afford Giuliani “the opportunity and time to pursue an appeal, while providing transparency for his finances under the supervision of the bankruptcy court, to ensure all creditors are treated equally and fairly throughout the process.”

The bankruptcy filing in New York comes the day after the judge overseeing Giuliani’s defamation case in Washington ordered him to immediately pay the $148 million he owes Freeman and Moss. Judge Beryl A. Howell wrote that there was a strong danger Giuliani is likely to hide his assets from the women, who had asked a jury at trial to award them roughly $47 million in damages for the racist attacks and abuse they received after Giuliani spread the debunked information about them.

Attorneys for Freeman and Moss still have to enforce the judgment against Giuliani, which may involve further court proceedings. But they do not have to wait the standard 30 days to begin trying to seize his assets.

“This maneuver is unsurprising, and it will not succeed in discharging Mr. Giuliani’s debt to Ruby Freeman and Shaye Moss,” Freeman and Moss’s attorney Michael Gottlieb said in a statement to The Washington Post after Giuliani’s filing for bankruptcy.

Giuliani talked about filing for bankruptcy on his radio show Thursday afternoon.

“I believe it was the responsible and only thing to do,” Giuliani said on his radio show. “I do not have the money to pay a $148 million verdict.” He also said, “Without that, I am not bankrupt.”

“I have probably something like $10, $11 million in assets,” Giuliani went on to say. “I have probably about $1 million in debt, which means I’m up $9, $10 million.”

Legal analysts say going bankrupt wouldn’t get Giuliani out of paying the women. On the night the jury returned its verdict against Giuliani, the former U.S. attorney for the Eastern District of Michigan Barbara McQuade said on MSNBC that debts for defamation and intentional infliction of emotional distress cannot be eliminated through bankruptcy.

However, he could attempt to re-litigate whether his conduct was, in the words of bankruptcy law, “willful and malicious.” Such a fight would take place before a bankruptcy judge and could allow Giuliani to delay payment or negotiate a post-verdict settlement, experts said before Howell issued the order demanding that Giuliani pay the women immediately.

Chris Mattei, who represented parents of Sandy Hook victims who won a $1.5 billion judgment against Alex Jones, said there are benefits and drawbacks for the plaintiffs in Giuliani’s bankruptcy.

The downside is that any collection is put on hold until the bankruptcy proceedings are over. But the upside is that it is much harder for Giuliani to hide or spend down his wealth.

“The whole idea for Giuliani here is to try to show what his assets are so he can then try to leverage a settlement in the bankruptcy court” that is far lower than the judgment, Mattei said. But because the debt cannot be eliminated through bankruptcy, “they are likely going to have a lot of leverage to say, we don’t want to take the pennies on the dollar.”

On Monday, Freeman and Moss filed another suit against Giuliani for continuing to make comments about them that his lawyer previously conceded in court were untrue.

Giuliani has previously refused to curb his public comments questioning the legitimacy of the 2020 election, even in the face of legal threats and other criticisms.

A week after the Jan. 6, 2021, riot at the U.S. Capitol, the radio station where Giuliani appears on-air six days a week issued a memo saying its hosts and guests should not question or undermine the legitimacy of the 2020 election. Giuliani has mostly ignored that directive.

When Dominion Voting Systems sued Giuliani for defamation in January 2021, he continued attacking the company on his weekday radio show. The following month, the radio station where Giuliani appears began airing a notice to listeners that Giuliani’s comments did not represent the views of the station. Giuliani, caught off guard by the notice, told listeners it was “insulting.”

YouTube removed several videos in March that Giuliani posted that violated the platform’s prohibition against “facilitating the use of nicotine, and our presidential election integrity policy.”

This post appeared first on The Washington Post

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