Rudy Giuliani, the former mayor of New York City, may find himself in a difficult position where he has to take legal action against his long-time ally, Donald Trump. This situation arises due to a group of creditors to whom Giuliani owes a significant amount of money, potentially totaling tens of millions of dollars.
The source close to the matter revealed that the Committee of Unsecured Creditors, who represent those to whom Mr. Giuliani owes money, are currently in discussions about potentially urging Mr. Giuliani to file a lawsuit against Trump in order to recover their funds (The Independent).
According to a source, discussions have been taking place within the group since early February regarding potential legal action against Mr. Trump. The aim of this litigation would be to recover the $2 million in unpaid legal fees owed to Mr. Giuliani. The disgraced lawyer believes that this amount is owed to him for his unfounded attempts to overturn the 2020 election results.
Legally, the committee has the authority to utilize the bankruptcy court as a means to enforce Mr. Giuliani’s obligation to initiate legal proceedings against the former president.
Despite Mr. Giuliani’s assertion during his recent bankruptcy hearing that he was owed by either the Trump campaign or the Republican National Committee and not by Mr. Trump himself, it is still possible for this to occur.
Ted Goodman, political advisor to Mayor Giuliani, confirmed that Mayor Giuliani will not be filing a lawsuit against President Trump. When contacted by The Independent, Goodman stated, “Mayor Giuliani will not be suing President Trump.” At the time of this statement, a representative for President Trump had not yet responded to a request for comment.
It would not be surprising if Mr. Giuliani hesitates to sue his former client. After all, the two New Yorkers have a long-standing bond that reached its peak when Mr. Giuliani advised Mr. Trump during his 2016 and 2020 campaigns. However, the situation might strain their partnership even further, as $2 million in unpaid wages is at stake.
According to reports, it seems that the $2 million figure is derived from a verbal agreement between the two individuals. Under this agreement, Mr. Giuliani was set to receive a daily rate of $20,000 as payment for his legal services. This arrangement was initially brought to light by The New York Times in 2021.
According to The Independent, two additional sources have confirmed that they personally heard about or had knowledge of the verbal agreement between Mr. Trump and Mr. Giuliani regarding the $20,000 a day arrangement.
According to a source familiar with the situation, Mr. Giuliani’s creditors are actively exploring various options to recover the money owed to them. These options may include the possibility of him pursuing a lawsuit against the Trump campaign and/or the Republican National Committee.
According to a source, the committee is looking for evidence of the legal fees agreement between Mr. Trump and Mr. Giuliani in order to support their decision to pursue litigation.
In December 2023, Mr. Giuliani was forced to file for Chapter 11 bankruptcy following a massive defamation verdict. The verdict required the man who was once known as “America’s Mayor” to pay over $148 million to two election workers. These workers were falsely accused by Giuliani of manipulating votes in Georgia.
Just before his bankruptcy hearing last month, Mr. Giuliani filed a document in court where he listed his assets and debts. In this filing, he mentioned a potential claim for unpaid legal fees against Donald J. Trump, although the exact amount is yet to be determined.
During the hearing, Mr. Giuliani was questioned about his claim regarding the payment he believed he was owed. He stated that he estimated the amount to be $2 million for the work he had done. Furthermore, he clarified that while he had received compensation for certain legal expenses, he had never received a salary for his services.
“When I assumed control, I was under the impression that the campaign would compensate me for my legal services, with my expenses being covered,” he explained during the hearing. “However, when we submitted the invoice for payment, they only reimbursed me for the expenses. Not all of them, but the majority. They never fulfilled the payment for the legal fees.”
In April 2018, Mr. Giuliani took on the role of Mr. Trump’s personal lawyer. Later, in November 2020, the former mayor of New York City embarked on a nationwide campaign to challenge and overturn Mr. Trump’s electoral defeat in the 2020 election.
According to a 2021 email from Maria Ryan, an associate of Giuliani obtained by The New York Times, it was reportedly suggested that Mr. Giuliani would be paid $20,000 a day for his work. The email was sent to Trump campaign officials.
According to the email, Mr. Giuliani allegedly started working on election litigation on November 4, 2020, just a day after Election Day.
According to former associate Lev Parnas, Mr. Giuliani informed him in multiple conversations that he and Mr. Trump had entered into a verbal agreement where Mr. Giuliani would be paid $20,000 per day.
According to Mr. Parnas, Ms. Dunphy, a member of the creditors committee, was present during a conversation in which Mr. Giuliani had Mr. Trump on speakerphone discussing the $20,000 daily rate. However, Ms. Dunphy’s lawyers have not yet responded to The Independent’s request for comment.
During a private conversation, Mr. Parnas recalled that Mr. Giuliani informed him about his anticipation of receiving $2 million from former President Trump.
The $2 million amount aligns with the $20,000 daily rate that Rudy Giuliani charged during the period from the November 2020 election to February 2021. This timeframe coincides with the statement made by Jason Miller, an adviser to President Trump, who clarified that Mr. Giuliani is currently not involved in any legal matters on behalf of the former President.
During the bankruptcy hearing, Mr. Giuliani was asked about the existence of a written agreement for fee payment between him and the former president. In response, he referred to it as a “word-of-mouth situation.”
As additional proof, Mr. Giuliani mentioned two lawyers who were present during his bankruptcy hearing and were aware of the agreement. Surprisingly, they also did not receive any payments. Unfortunately, they did not respond to a request for comment.
In 2023, the New York Times reported that Mr. Giuliani had previously made efforts to recover his wages. According to the report, his former lawyer, Robert Costello, had reached out to at least six attorneys who were close to the former president in an attempt to collect the money that was allegedly owed to Mr. Giuliani.
Mr. Costello declined to comment on The Independent’s request and referred the matter to Mr. Giuliani’s spokesperson.
According to Adrienne Hines, an Ohio-based bankruptcy attorney who has no connection to the case, she provided an explanation of the process being undertaken by the creditors committee.
According to Ms. Hines, once Mr. Giuliani discloses his assets and identifies the individuals and entities that might owe him money, it becomes the committee’s responsibility to investigate the availability and value of these assets. The committee also needs to determine who else has claims on these assets and explore possible sources of funds.
According to Ms. Hines, if the committee deems the claims to be “viable,” such as the one mentioned concerning Mr. Trump, they have the authority to assume the debtor’s position. This means they can initiate legal action, engage in settlement negotiations, or even push the debtor to file a lawsuit.
According to Ms. Hines, the committee’s ability to pursue legal action against Mr. Trump would depend on their ability to demonstrate the existence of an agreement, similar to a contract.
According to reports, it is claimed that the legal fees arrangement in this case was based on a verbal agreement.
Mr. Giuliani confirmed that he had received expenses, which could be proven through checks, wire transfers, or bank statements. These records could potentially demonstrate the existence of an agreement between the two men. This evidence is crucial in determining who is responsible for reimbursing him.
The committee’s decision to compel Mr. Giuliani to take legal action against the former president could potentially create a challenging situation for the former mayor. Back in September 2023, in an effort to assist Mr. Giuliani with covering his legal expenses, Mr. Trump organized a high-priced fundraiser at his Bedminster golf club, where attendees paid a significant $100,000 per plate. However, it is worth noting that the event generated less than $1 million from a total of 13 donors.
The attorneys representing the creditors listed in court documents have chosen not to comment and have instead referred inquiries to the lawyers representing the committee. Unfortunately, the lawyers representing the committee did not respond to requests for comment from The Independent.
Creditors are in a frenzy to recover their owed amounts without resorting to legal action. Mr. Giuliani, who has assets worth over $10 million, has the potential to sell off his valuable belongings, including two high-priced properties, a Mercedes-Benz, and a signed Joe DiMaggio shirt.
Filing another lawsuit against the former president would only serve to increase the already mounting legal expenses for Mr. Trump, who is currently vying for the Republican nomination for president. Over the past year, his campaign has been forced to shell out millions of dollars to cover the costs of his civil and criminal legal battles. Furthermore, he is now facing the prospect of devastating multimillion dollar judgments in New York for defamation and fraud.
The financial fallout from the lies surrounding the 2020 election has exceeded $1 billion. This includes the recent defamation verdict against Mr. Giuliani and the various lawsuits related to it. Additionally, there was a settlement between Fox News and a voting machines company, which prevented a high-profile defamation trial. These lawsuits are just a few examples of the ongoing legal battles stemming from false claims made during the election.
