Lawyer in Girardi bankruptcy out after stormy tenure

Ronald N. Richards, who was hired by the bankruptcy trustee of famed plaintiffs' attorney Thomas V. Girardi's law firm to investigate and recover any assets that had been transferred to his wife, is out as special litigation counsel.

Elissa D. Miller, a partner with SulmeyerKupetz who is handling the Girardi Keese bankruptcy, replaced Richards with Larry W. Gabriel, a Jenkins Mulligan & Gabriel LLP partner in a Thursday filing. She declined to comment through a spokesperson Thursday. In re: Girardi Keese, 20-BK21022 (C.D. Bankruptcy Ct., filed Dec. 18, 2020).

Jay Edelson, founder and CEO of Edelson PC, which is seeking permission from a bankruptcy judge in Los Angeles to pursue Erika Girardi's assets in Illinois federal court, said Richards was ousted Wednesday.

"He was fired yesterday," Edelson said during a phone interview Thursday morning.

Richards characterized his departure from the bankruptcy case as a mutual decision in a written statement Thursday.

"The Trustee and I jointly determined that a change in counsel is in the best interests of the estate," he wrote in an email.

The Beverly Hills attorney has attracted a large following on Twitter and YouTube commenting on the Girardi bankruptcy and especially about his celebrity wife, Erika Girardi, before and during his time working for Miller.

"I want to be liberated to talk about what's important about the case, and that's easier if I'm not a lawyer tethered to a client," he said in an interview with the Daily Journal on Wednesday evening. "I think it's better just to cut ties at this point."

Miller filed an application in bankruptcy court Thursday morning to replace Richards with Gabriel.

"The Trustee has previously retained Gabriel as special litigation counsel and has a close working relationship with Gabriel that has produced significant results for the benefit of the estates," she wrote.

The attorney said he would continue working on another lawsuit involving Erika Girardi, best known to the general public as Erika Jayne, a star of the Bravo television series, "The Real Housewives of Beverly Hills."

That case involves two lawyers who have sued Erika Girardi and former Girardi Keese attorneys for fraud by the now-bankrupt firm. Law Offices of Philip R. Sheldon et al. v. Girardi et al., 20STCV47160 (LA County Sup. Ct filed Dec. 9, 2020).

And Richards plans to keep opining about the Girardi litigation on Twitter, where he characteristically announced his departure from the bankruptcy case Wednesday, and YouTube, where he made an appearance discussing the Girardi litigation Thursday morning.

Richards said he's busy with many other lawsuits and noted the Girardi bankruptcy matter was a contingency case.

"My litigation style is better unrestricted," Richards said. "If there's outside complaints or people are telling you to tone it down, I can't operate that way."

The attorney's outspokenness on Twitter, which sometimes devolved into online feuds with Erika Girardi, drew strong objections from her attorneys, who twice sought to remove him as special litigation counsel.

U.S. Bankruptcy Judge Barry Russell of Los Angeles rejected those motions.

In recent weeks, Richards and Erika Girardi's attorney, Greenberg Gross LLP partner Evan C. Borges, have made common cause against Edelson, a Chicago firm that worked with Girardi Keese in litigation over a 2018 airplane crash in Indonesia. Family members of victims in that crash say they have not received settlement money from Girardi's firm.

Borges and Richards both argued that Edelson's bid to remove a stay on its lawsuit, pending in Illinois federal court, accusing Girardi Keese and Erika Girardi of misappropriating settlement funds, should be rejected because Edelson's fee-sharing agreement with Girardi Keese was invalid.

This prompted an allegation Tuesday by Edelson PC partner Rafey S. Balabanian that Richards, working for the trustee, and Borges were making a coordinated effort to "mislead and manipulate the court."

"The point, though, is crystal clear: Mr. Richards and Erika are apparently willing to say or do anything they need to in order to keep Edelson's investigation away from Erika Girardi and clear the way for Mr. Richards and Erika to negotiate a back room settlement," Balabanian wrote.

Borges, who called Balabanian's allegations "baloney," said he was surprised to learn Richards would no longer serve as counsel to the trustee.

Edelson said Thursday that some of the money that was supposed to go to victims of the Lion Air crash in Indonesia instead was "paid out to Erika [Girardi] or her companies."

A contempt motion is pending against former Girardi Keese attorneys David R. Lira and Keith D. Griffin in the Lion Air plane crash case. In re: Lion Air Flight 610 Crash, 18-CV-7686 (N.D. Ill., filed Nov. 19, 2018). Edelson's firm is leading it.

An evidentiary hearing on the contempt motion is scheduled Dec. 8 and 9.

Edelson has filed a separate lawsuit against Lira, Griffin, and other defendants including Erika Girardi, and the Chicago firm's motion in bankruptcy court is seeking permission to pursue assets from the Lion Air settlement he said were transferred to her. Edelson PC v. Girardi et al., 20-CV-07115 (N.D. Ill., filed Dec. 2, 2020).