State Bar admits ‘mistakes’ in handling complaints against ‘Real Housewives’ Tom Girardi
Originally Published; Jun 10, 2021 | Republished by LIT; Jun 12, 2021
For decades, the 82-year-old Girardi seemed an immutable force in the plaintiff’s bar in California and beyond, winning huge settlements and judgments against drug companies and toxic polluters, including in the case immortalized in the film “Erin Brockovich.”
In more recent years, he also enjoyed pop culture notoriety on “The Real Housewives of Beverly Hills” alongside his now-estranged wife, pop singer Erika Jayne.
Friends and peers were shocked when his well-respected firm, Girardi Keese, collapsed last year. Then evidence began piling up that he had misappropriated millions in settlement money from vulnerable clients — including widows, orphans, a burn victim and his family — in what one colleague characterized to a federal judge as a long-running Ponzi scheme.
Girardi and his law firm have since been forced into bankruptcy, and a court-appointed bankruptcy trustee has said in court papers that he owes more than $56 million to creditors, former clients and lenders.
The bar did not say whether the specific mistakes uncovered in the audit were related to Girardi’s currying of favor with staff or trustees, nor did the agency say whether its findings resulted in the discipline or termination of employees.
Tom Girardi was able to stay in the state bar’s good graces for decades while attorneys accused of similar wrongdoing were reprimanded, suspended or disbarred.
The audit was performed by Alyse Lazar, a Thousand Oaks attorney who was a supervising prosecutor for the bar in the 1990s and who already conducts random reviews of closed discipline cases, according to Teresa Ruano, a bar spokeswoman. Lazar, who declined to comment, was ultimately paid more than $25,000 for reviewing the Girardi complaints, which began March 15.
Ruano said she could not disclose specific information about the number or nature of the complaints that were part of the audit and maintained that the final report was shielded by attorney-client privilege.
“The details of the audit are confidential,” Ruano said.
The two state lawmakers who chair a pair of legislative committees that oversee the State Bar told The Times that it was imperative for the audit to be released to the public.
“This is not like a national security issue,” Umberg said. “The revelation of this … will help us to protect consumers. Unless the nuclear codes are somewhere in there, I think they could release most of it.”
Umberg, who is also a practicing attorney, said transparency was essential to restoring the credibility and trust of the bar. He noted that fellow attorneys and members of the community repeatedly ask how lawmakers will respond to the apparent lapses in discipline in the Girardi case.
“The Girardi debacle — it’s an embarrassment to the entire profession,” Umberg said. “The question is: Have there been other failures of a similar nature?”
Assemblyman Mark Stone (D-Scotts Valley) said the audit’s findings exposed “pervasive and institutional shortcomings” in how attorneys are regulated.
Tom and Erika Girardi on “Real Housewives of Beverly Hills.”
Stone, who chairs the Assembly Judiciary Committee, likewise called for disclosure of the audit report and demanded “a full audit of the Girardi case by an outside entity.” Such a review would be used by the Legislature, Supreme Court and the public to illuminate what went wrong, he said.
“I am very concerned that the Bar made numerous errors and oversights in the Girardi case over a four-decade period,” Stone said. “These mistakes endangered the public, allowed Girardi to prey on vulnerable clients, and have seriously undermined confidence in the competence of the State Bar.”
Numerous trustees of the bar declined to comment to The Times. According to the news release, the trustees have asked that bar employees “investigate new and innovative means of regulating and monitoring attorney-client trust accounts to prevent misappropriations from occurring in the first place.”
Jay Leno performs at Tom Girardi’s 2014 party in Las Vegas.
(Matt Hamilton / Los Angeles Times)
The agency said it was also considering the hiring of accounting experts to examine the “high-dollar” client trust accounts — the bank accounts attorneys use to hold clients’ money — as well as installing automated tools to help identify “patterns of behavior that could signal possible misconduct.”
“We must use lessons learned to strengthen the State Bar’s rules, policies and procedures to avoid replicating problems of the past,” said the board’s chair, San Francisco attorney Sean SeLegue.
Tom Girardi presents closing arguments in the civil trial in Bryan Stow’s lawsuit against former Dodgers owner Frank McCourt and the Los Angeles Dodgers.
(Irfan Khan / Los Angeles Times)
The bar is trying to disbar Girardi, formally accusing him of misappropriating millions in client funds, dishonesty and other unprofessional conduct. He was diagnosed with Alzheimer’s disease this year, and his brother, who acts as his legal guardian, has told the bar through a lawyer that Girardi will not practice law again and does not plan to contest the proceedings.
Did you know…in less than 5 years, the number of complaints against judges in the 11th Circuit has more than DOUBLED in less than 5 years?
— LawsInTexas (@lawsintexasusa) December 5, 2020