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State Bar Claims Thomas Girardi Intentionally Stole From Clients

March 31, 2021, 1:41 AM

The State Bar of California has filed disciplinary charges against Thomas Girardi over claims that the now infamous plaintiffs’ attorney stole millions in client settlement funds, according to a 14-count disciplinary notice filed Tuesday.

Girardi isn’t eligible to practice law pending resolution of the allegations, which is standard practice when disciplinary charges are filed and the bar believes the allegations are serious and well-founded—and mandatory where, as here, an attorney has asserted a claim of incompetence.

The disciplinary action follows a state probate court’s decision to overrule the bar’s objections to the appointment of a temporary limited conservator due to claims that Girardi is suffering from age-related memory loss on March 23. According to the state probate court’s order, Girardi “lacks capacity to make health-care decisions.”

The petition for conservatorship claimed that Girardi “suffers from dementia and is unable to care for himself.” But in November, “Girardi was holding himself out as a legal expert and moderated a legal education panel with leading trial attorneys and presented on complex litigation strategy,” according to the bar’s overruled objection.

Although incompetency would ordinarily preclude disciplinary proceedings, the state bar has expressed doubt that Girardi is actually suffering from dementia, suggesting that it might be a ploy to avoid responsibility for his alleged theft of client funds. The petition was filed only after a federal district court judge referred allegations that Girardi embezzled client settlement funds to federal prosecutors in December.

The bar alleges “major misappropriation of client funds” and claims that the misconduct was intentional.

The notice of disciplinary charges alleges six counts of moral turpitude related to misappropriation, three counts of failing to maintain client funds in a trust account, two counts of failing to promptly distribute client funds, and one count of disobeying orders by the U.S. District Court for the Northern District of Illinois related to his failure to pay $2 million in client settlement funds to family members of individuals killed in the 2018 crash of Lion Air flight 610.

The remaining two counts of the complaint claim that Girardi has failed to cooperate in the state bar’s related disciplinary investigations, which were initiated shortly after the Illinois court found him in contempt and referred the matter to federal prosecutors.

The case is In re Girardi, Cal. State Bar, Nos. 20-O-15684; 20-O17192; and 20-O-17505, Notice of Disciplinary Charges 3/30/21.

To contact the reporter on this story: Holly Barker in Washington at hbarker@bloombergindustry.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Patrick L. Gregory at pgregory@bloomberglaw.com