Trustee seeks firm to take on Girardi Keese cases

An interim trustee said Friday she is looking for a law firm to take over cases pending at embattled law firm Girardi Keese, and added she was prepared to protect the bankruptcy estate via litigation if necessary.

Elissa D. Miller, a partner at SulmeyerKupetz APC who was appointed by the U.S. Trustee last week to handle Girardi Keese's finances, said she anticipates disputes by various creditors and firms over who will collect the money Girardi Keese earned in recent settlements and may earn later in pending cases.

Likening the many claims to the firm's assets to "vultures at a carcass," Miller said Girardi Keese invested time and money into its cases, and is entitled to recoup some of the settlement funds. Her goal, she said, is to "protect the estate in terms of the funds that it needs because there are people out there who have been very badly hurt by the firm's not paying them. ... I hope to get something out to them."

In recent weeks, a number of the firm's creditors and former co-counsel have alleged in lawsuits and court filings that the firm owes them various sums totaling millions of dollars. Thomas V. Girardi's longtime partner Robert M. Keese and several other creditors filed involuntary bankruptcy petitions against Girardi Keese and Girardi in December, and asked the court to appoint an interim trustee to ensure the firm does not lose its clients and files, which they believed were its largest asset and which they said are at risk of being poached by other firms.

The U.S. Trustee appointed Jason M. Rund of Sheridan & Rund PC to handle Girardi's finances. Rund and Miller will act as trustees for Girardi and his firm at least until the respondents' Jan. 15 deadline to reply to the involuntary bankruptcy petitions. In re: Thomas Vincent Girardi, 20-BK21020 (C.D. Cal Bankruptcy Ct, filed Dec. 18, 2020); In re: Girardi Keese, 20-BK12022 (C.D. Cal Bankruptcy Ct, filed Dec. 18, 2020).

While Miller said she would prefer to have one firm finish all the cases pending at Girardi Keese, she would be open to assigning them to more, if necessary. Miller has hired Lei Lei Wang Ekvall, a partner at Smiley Wang-Ekvall LLP, to help her broker deals with law firms, "both to take over the existing cases and to get our share of the fees," she said.

Girardi and Girardi Keese are listed as pro se litigants and have not responded to bankruptcy the petitions.

In a status hearing Friday in the Northern District of Illinois, Miller and Rund asked U.S. District Judge Thomas M. Durkin to lift the freeze Durkin imposed on the assets of Girardi and his firm on Dec. 14, so they could proceed with their work. Durkin agreed.

Durkin is presiding over In re: Lion Air Flight JT 610 Crash, 18-CV07686 (N.D. Ill., filed Nov. 19, 2018), a lawsuit filed by the family members of passengers who died in a Boeing jet crash in Indonesia. On the same day Durkin froze the assets, he entered a civil contempt finding against Girardi and his firm following allegations Girardi embezzled settlement money owed to his clients.

On Friday, Durkin said he would continue to consider whether to enter a civil contempt against former Girardi Keese attorneys David Lira and Keith Griffin, who were accused by the firm's co-counsel on the Lion cases of covering up Girardi's embezzlement activity. "To the extent the Court determines a hearing is necessary, it will take place in Chicago, in person, and not until it is safe to travel and hold in-person hearings," Durkin wrote in an order.