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Tom Girardi, a former high-profile trial lawyer known for winning a record settlement for the environmental activist Erin Brockovich, has been indicted by federal grand juries in Los Angeles and Chicago on charges that he embezzled more than $18 million from clients, prosecutors said on Wednesday.
Mr. Girardi was charged with five counts of wire fraud in Los Angeles for stealing money from clients from 2010 to 2020. In addition, Mr. Girardi and David Lira, a lawyer in Mr. Girardi’s Los Angeles law firm, Girardi Keese, face eight counts of wire fraud and four counts of criminal contempt of court in Chicago for misappropriating more than $3 million in settlement funds that were supposed to go to families of victims of the 2018 Lion Air crash in Indonesia, according to prosecutors. Mr. Lira is Mr. Girardi’s son-in-law.
And Christopher Kamon, the former chief financial officer of Girardi Keese, faces charges in Los Angeles and Chicago.
“Mr. Girardi and Mr. Kamon stand accused of engaging in a widespread scheme to steal from their clients and lie to them to cover up the fraud,” Martin Estrada, the U.S. attorney for the Central District of California, said in a statement. “In doing so, they allegedly preyed on the very people who trusted and relied upon them the most — their clients.”
In the statement, Amir Ehsaei, the acting assistant director in charge of the F.B.I.’s field office in Los Angeles, added that the defendants had exploited the hardships endured by their clients and “denied victims what was rightfully due to them in order to fund their lavish lifestyles.”
Mr. Girardi, 83, for years earned a reputation for being one of the country’s best “toxic tort” lawyers, taking on personal injury lawsuits against large corporations for damages arising from exposure to chemicals and pollutants. He was part of the legal team when Ms. Brockovich went after Pacific Gas & Electric in 1993, a case that later inspired the 2000 movie “Erin Brockovich,” starring Julia Roberts in the title role.
But in recent years, Mr. Girardi’s reputation has fallen into disrepute. As former clients filed lawsuits against him for embezzlement, his firm was forced into bankruptcy, and most of his assets were frozen. His wife, Erika Jayne, who appeared on the reality TV series “The Real Housewives of Beverly Hills,” filed for divorce in 2020 after two decades of marriage. He was disbarred in California last year.
Damon Cheronis, Mr. Lira’s lawyer, said that Mr. Lira intended to enter a plea of not guilty. “David Lira is not Tom Girardi — he did not steal from his clients and he should not be criminally charged for Girardi’s misconduct,” he said. It was not immediately clear who was representing Mr. Girardi and Mr. Kamon.
According to the indictment in Illinois, Mr. Girardi, Mr. Kamon, 49, and Mr. Lira, 62, stole money from five clients whose family members had been killed in the 2018 plane crash. Instead of giving the settlement money to their clients, they used most of it to settle the firm’s payroll and operating expenses, as well as to pay other clients whose own settlement funds had been misappropriated by the firm, according to the indictment.
In California, Mr. Girardi and Mr. Kamon are accused of pocketing most of the settlement money from clients and transferring just a small amount to them. They told the clients that these small payments were merely advances and that the rest of the funds had not yet been received, the indictment said.
In one example laid out by prosecutors, Mr. Girardi in 2019 negotiated a $17.5 million settlement of a lawsuit related to injuries sustained in a car accident by two clients and their child, who was paralyzed in the crash. Instead of transferring the child’s portion of the settlement money into a trust, Mr. Girardi and Mr. Kamon used the settlement money to pay for the law firm’s operating expenses unrelated to the car accident litigation, while delivering clients just a fraction of what was owed to them, prosecutors said.
Mr. Girardi is expected to appear in U.S. District Court in Los Angeles on Monday for arraignment. The California charges carry a statutory maximum sentence of 20 years in federal prison.
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