The Hill reported on this development, pointing out that his creditors are accusing him of hiding assets and a deal to launch his own coffee brand. They have also accused the erstwhile counsel for former President Donald Trump of spending egregiously and failing to file required paperwork on time.
Given these allegations, the unsecured creditors had enough. Their lawyers have expressed plans to return to bankruptcy court in New York on June 17, with the aim of convincing U.S. Bankruptcy Judge Sean Lane that a trustee must be appointed. "Simply put, Giuliani and his bankruptcy case have reached an impasse," the creditors wrote in their 55-page motion filed on May 28.
In the filing, Giuliani's creditors argued that the former mayor of the Big Apple has shown a preference for "theatrics over progress." They continued: "His creditors do not need to accept this as their plight and [they] refuse to do so. Accordingly, the time has come for the immediate appointment of a Chapter 11 [bankruptcy] to take control of the debtor's assets and financial affairs – including his wholly-owned businesses."
According to The Hill, Giuliani's decision to file for Chapter 11 bankruptcy means he still has control of his assets for now. But if Lane sides with his creditors, the court-appointed trustee could look to sell assets or prevent the former mayor from diverting assets to his companies, which have not filed for bankruptcy.
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"Giuliani went into chapter 11 because he wanted to retain control. This is the key to [his] bankruptcy, said attorney Daniel Gielchinsky, a partner at the South Florida-based DGIM Law who specializes in bankruptcy law. (Related: Rudy Giuliani petitions for Chapter 11 bankruptcy after a jury ordered him to pay $146M in damages to 2 Georgia election workers.)
Bankruptcy also preventing defamation lawsuit defendants from getting paid
In December, Giuliani hastily filed for Chapter 11 bankruptcy after a jury ordered him to pay $148 million to two Georgia election workers. The plaintiffs, a mother and daughter tandem, accused him of defamation by claiming they were involved in election fraud to ensure Trump doesn't win the Peach State in the 2020 election.
The bankruptcy filing automatically froze the plaintiffs' effort to collect the massive sum. They believe federal law prevents Giuliani from discharging the amount awarded to them as a result of the lawsuit. But that could change soon as the creditors hope to take the reins, given that they have expressed concerns about Giuliani's genuineness in filing for bankruptcy for months.
Giuliani's finances have spilled out into public view ever since his bankruptcy filing in December. He has disclosed $10.6 million in assets, including a Mercedes-Benz, two individual retirement accounts and three Yankees World Series rings. His income and spending have also come under scrutiny, including credit card statements showing he spent thousands to cover costs for his businesses.
But the bulk of his assets comprises his homes in New York and Florida and questions have swirled about Giuliani possibly selling them. Creditors previously sought to compel Giuliani to sell his $3.5 million condominium in Florida's Palm Beach – a request the bankruptcy judge denied.
Lane noted during a subsequent hearing that it was a "warning shot across the bow." He continued: "The debtor can succeed in fending off this motion only to be faced with far more draconian requests for relief by the committee in the future."
Ted Goodman, an advisor to Giuliani, defended the former mayor in a statement.
"These incessant court filings are part of a larger effort to bully the mayor into silence through lawfare and a public smear campaign. [Former NYC] Mayor Rudy Giuliani – one of America's most effective federal prosecutors in history – won't be bullied into capitulation by a concerted effort by bad-faith actors to silence the mayor and anyone else willing to take on the permanent Washington political class."
Watch Rudy Giuliani explaining to Miriam Shaw that he is targeted for being the biggest defender of former President Donald Trump.
This video is from the Moms On A Mission channel on Brighteon.com.
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Giuliani pleads NOT GUILTY in 2020 Arizona election interference case.
Rudy Giuliani claims Trump campaign still OWES HIM $2M in legal fees.
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