Rudy Giuliani Could Face Yet Another Court Battle

Two Georgia election workers who successfully sued Rudy Giuliani for defamation may face another court battle to get their money, a legal expert has said.

Giuliani, the former mayor of New York, declared bankruptcy two days after he was ordered to pay $148 million to a mother and daughter he wrongly accused of secretly adding ballots for Joe Biden during the 2020 presidential election.

That means that the two women, Ruby Freeman and Shaye Moss, will likely have to go to bankruptcy court to obtain any money, according to Eric Chaffee, a law lecturer at Case Western Reserve University School of Law and an expert in business law.

Chaffee told Newsweek that Freeman and Moss' chances of success are far from certain.

"During the bankruptcy process, a court will consider which of his debts should be discharged and what, if anything, creditors will receive. There is some question as to whether the $148 million judgment against him is dischargeable, and that will have to be litigated in court," he said.

Chaffee said that he is not surprised Giuliani has declared bankruptcy.

"Rudy Giuliani has decided to declare bankruptcy as a means for avoiding a massive amount of legal liability that he has accrued based upon court judgments against him or at least delay it. After filing bankruptcy, an automatic stay keeps creditors from pursuing him while he has time to appeal the massive civil judgment against him," he said.

He added that Giuliani's bankruptcy case could continue for quite some time as other lawsuits are pending against him.

"Mr. Giuliani does have other legal matters pending against him. A court is likely to wait for these matters to be resolved prior to closing Mr. Giuliani's bankruptcy case. Even if it does not, a person can file personal bankruptcy multiple times," Chaffee said.

"Bankruptcy in the United States is designed to give individuals a fresh start when they become overwhelmed by debt. For many people, this becomes their path to leading productive lives when they have too many obligations to creditors. With that said, bankruptcy is also a mechanism for avoiding legal liability," he said.

Giuliani was working as Donald Trump's election attorney when he made the false allegations about Freeman and Moss. He filed a Chapter 11 bankruptcy petition in the U.S. Bankruptcy Court for the Southern District of New York on December 21, 2023, according to court documents.

The former mayor listed his liabilities as somewhere between $100 million and $500 million and his assets as between $1 million and $10 million.

​​A law firm that previously represented Mr Giuliani, Davidoff Hutcher & Citron LLP, is also listed as a creditor in Giuliani's bankruptcy filing. The firm sued him for $1.4 million in unpaid legal fees in September.

Giuliani still faces an indictment in Georgia on racketeering and conspiracy charges as well as a $10 million lawsuit by a former business associate over sexual harassment claims.

Giuliani's spokesman, Ted Goodman, said in a statement that the bankruptcy filing "should be a surprise to no one."

"No person could have reasonably believed that Mayor Rudy Giuliani would be able to pay such a high punitive amount," he said. "Chapter 11 will afford Mayor Giuliani the opportunity and time to pursue an appeal while providing transparency for his finances under the supervision of the bankruptcy court to ensure all creditors are treated equally and fairly throughout the process."

Goodman has not yet replied to Newsweek's specific questions about Giuliani's bankruptcy.