Giuliani Reaches Bankruptcy Dismissal Deal to Pay Legal Fees

Rudolph Giuliani has agreed to pay $100,000 in cash and use proceeds from future sales of his multimillion-dollar homes to satisfy administrative bankruptcy fees and formally end his Chapter 11 case.

Giuliani and his largest creditors said Wednesday that they reached a deal stipulating terms of how the cash-strapped former New York City mayor will leave bankruptcy. The agreement puts to rest the possibility that Giuliani would be forced to answer questions in bankruptcy court about his financial circumstances.

Although Judge Sean H. Lane of the US Bankruptcy Court for the Southern District of New York ruled three weeks ago that the case must be dismissed due to a lack of meaningful progress, Giuliani struggled to put forth workable terms guaranteeing payment for an estimated $400,000 in case-related fees.

Lane said in a July 25 order that he would consider initiating proceedings requiring Giuliani to disclose financial details and testify under oath. Although Giuliani’s repeated failure to produce financial records is what led the court to dismiss his bankruptcy, “there may come a point when dismissal is no longer an option because the Debtor is unwilling to pay these administrative expenses,” Lane said.

Under the proposed order filed Wednesday, Giuliani will immediately pay $100,000 to satisfy a portion of the professional fees owed to forensic accounting firm Global Data Risk LLC. The remainder of GDR’s approved fees and expenses will be paid out of the proceeds earned from the anticipated sale of Giuliani’s Manhattan penthouse apartment or his condominium in Palm Beach, Fla.

The dismissal order stipulates that GDR will be granted valid and enforceable liens against both properties, with permission to foreclose if the fees still aren’t fully paid after a six-month standstill period.

Giuliani’s Upper East Side penthouse is currently on the market for $5.7 million, while his Florida residence has been valued at about $3.5 million.

The former Donald Trump attorney filed for bankruptcy in December after being hit with a $148 million defamation judgment for falsely accusing two Georgia election workers of rigging 2020 election ballots in favor of Joe Biden.

Giuliani, who reported $10.6 million in assets, repeatedly failed over the course of nearly seven months in Chapter 11 to produce full and accurate financial records, keeping creditors in the dark about what funds he has at his disposal.

In addition to facing the $148 million judgment, Giuliani is in the process of battling a defamation suit brought by Dominion Voting Systems and criminal cases related to his efforts to overturn 2020 election results. He also faces sexual harassment and assault claims brought by his former employee, Noelle Dunphy, who sued Giuliani last year for $10 million.

Giuliani is represented in his bankruptcy by Berger, Fischoff, Shumer, Wexler & Goodman LLP. A committee of unsecured creditors is represented by Akin Gump Strauss Hauer & Feld LLP. The Georgia election workers are represented by Willkie Farr & Gallagher LLP.

The case is In re Rudolph W. Giuliani, Bankr. S.D.N.Y., No. 23-12055, Proposed order 7/31/24.