Embattled reality star Erika Jayne is being sued for $25M by the trustee handling estranged husband Tom Girardi’s firm’s bankruptcy case.
On Friday Page Six reported that the trustee in charge of the Girardi Keese Chapter 7 bankruptcy case has accused the reality star of ‘knowingly allowing’ the firm to pay for her lavish lifestyle and frivolous expenses over the course of a decade.
As the Real Housewife has continued to maintain that she was ‘kept away from the books,’ the trustee is mandating that even if that were to be the case ‘it would be a miscarriage of justice if [she] was allowed to simply walk completely free of owing over $25,000,000 to the Estate.’
In deep! Erika Jayne is being sued for $25 Million by the trustee handling the Girardi Keese Chapter 7 bankruptcy case and has been accused of ‘knowingly allowing’ the firm to pay for her lavish lifestyle; Erika pictured on August 26 – one day before lawsuit news broke
On August 26 — one day before the lawsuit news broke — Erika was seen looking a bit distraught in leggings and a purple shirt while taking a walk in Beverly Hills.
The now unearthed lawsuit reads that ‘any payments made for her benefit are her responsibility,’ after it was alleged that she had spent $25 million of the firm’s money from 2008 to 2020 — funds that were allegedly transferred into her personal company EJ Global LLC.
‘She attempts to create a distinction between handing her money directly versus paying all of her bills directly. The distinction, like her prior motion for reconsideration is meritless. Any payments made for her benefit are her responsibility’ the documents alleged.
The trustee wants the court to rule that Jayne must cough up the $25 million she was said to have spent plus interest.
And the scathing suit continued to say that she ‘feigned willful blindness’ as she had signed off on numerous tax returns, credit card slips and knew what she had spent on her now bankrupt estranged husband’s cards.
Distraught: One day ahead of the news breaking about her $25M lawsuit, Erika was seen looking distraught as she took a walk in Beverly Hills; August 26
‘Erika signed all of her tax returns, numerous credit card slips, and was well aware of the money she spent on the Debtor’s credit cards and the Debtor’s payment of her personal expenses,’ the trustee continued to allege.
‘Her feigned willful blindness and ostrich approach to these expenditures will do absolutely nothing to limit her liability.’
It was added: ‘The glam cannot be supported by a sham.’
Ronald Richards, the trustee’s attorney, told the publication on Friday that there is ‘undeniable’ evidence that she knew about the expenses.
‘The evidence is undeniable. The law firm paid out over $25,000,000 in expenses which were approved and generated by one person, Erika Girardi.’
Accountable: The trustee wants the court to rule that the reality star should pay back the $25 Million she spent plus interest and the suit alleges that she ‘feigned willful blindness’ to the financial wrongdoing the whole time
He said the lawsuit was filed ‘to provide a come to Jesus moment,’ for the reality/pop star who needs to ‘come down the mountain from a place of privilege.’
‘We are hopeful that Ms. Girardi comes down the mountain from a place of privilege and obscene wealth and returns some of these expenses so the former clients and creditors of this law firm can mitigate the horrific and unfair losses perpetrated by her husband and others,’ Richards added.
The news comes just days after it was revealed that her ex Girardi’s firm owes more than $100 million to creditors, but it was added in Friday’s suit that Erika is not responsible for ‘the full amount’ of debt Girardi Keese owes.
In legal documents obtained by PEOPLE, the total liabilities sit at $97 million more than the total assets of all property — which is roughly $4.1 million.
Where did it go? Jayne allegedly spent $14,259,012.84 on her American Express card and $1,417,587.50 on unknown purchases – as well as $1,532,774.88 on an agency for dancers and choreographers, the McDonald Selznick Associates Agency among other things from 2008 to 2020; pictured May 2021
The trustee handling the Chapter 7 bankruptcy case noted upon reviewing the firm’s records that ‘the debtor’s accounting offices were not well maintained’ and that the records were ‘very dated.’
It was added that the trustee’s findings might ‘not have listed all of the debtor’s causes of action or potential causes of action against third-parties as assets,’ according to court docs, as the ‘actual total may be different than the listed total.’
His firm Girardi Keese has now begun to auction off a handful of Jayne’s personal memorabilia and collectibles including art and furniture to pay creditors amid the bankruptcy case.
In June, Erika was ‘ordered’ to turn over financial records from her accountant, lawyer and landlord as part of the embezzlement investigation and a bankruptcy trustee is documenting the couple’s assets.
Claiming innocence: Erika has repeatedly claimed on this season of the hit Bravo show that she was ‘kept away from the books’ and said that their whole life existed on credit cards
Better times: Erika filed to divorce Girardi in November 2020 which was later
Among many findings it was revealed that she had spent $25 million of the firm’s money from 2008 to 2020 — funds that were transferred into her personal company EJ Global LLC.
Per Page Six, Jayne allegedly spent $14,259,012.84 on her American Express card and $1,417,587.50 on unknown purchases – as well as $1,532,774.88 on an agency for dancers and choreographers, the McDonald Selznick Associates Agency.
Among the unknown purchases, her company reportedly paid $102,596.77 to Kim Kardashian’s former executive assistant Stephanie Shepherd.
Other bank statements show that $17,415 was paid to Opus Beauty – a management agency that represents make-up artists, stylists and costume designers – and $1,000 to influential makeup artist Mario Dedivanoic.
At this time nearly $1.3 million is still unaccounted for with regards to personal spending.
Opulence: Erika has been forced to downsize her very lavish lifestyle amid the divorce and bankruptcy after having previously revealed to have a personal trainer four times a week, a housekeeper seven days a week and regular glam
And despite claiming on the current season of the Real Housewives of Beverly Hills that she was ‘kept away from the books’ — even with regards to financial dealings of her own LLC — the letter read that she ‘approved the charges.’
‘Mrs. Girardi signed under penalty of perjury the return and personally approved the charges allocated to the breakdown,’ the letter read in excerpt.
Her attorney fired back: ‘No money whatsoever went to Erika’ and maintained that she never had a role in managing her now bankrupt husband’s company.
Girardi was placed under the conservatorship of his brother Robert after he was diagnosed with dementia and late-onset Alzheimer’s.
On August 23 the embattled former attorney was seen checking out an assisted living facility called Belmont Village Senior Living in Burbank, California.
The cost of admission is said to be between $4,545 – $4,750 a month for a private suite and the facility features round the clock care.
On August 19 Tom was federally disbarred according to documents filed under the Central District of California.
Assisted living: On August 23 Tom was pictured touring Belmont Village, an assisted living facility in Burbank, California
Downsizing: The cost of admission is said to be between $4,545 – $4,750 a month for a private suite and the facility features round the clock care
In March the State Bar of California filed discipline charges against him as they accused him of misappropriating millions in client funds and cited more than 100 lawsuits filed, alleging ‘financial wrongdoing and theft,’ according to the LA Times.
On May 27 legal documents showed that the Central District of California issued an order ‘to show cause’ why he ‘should not be disbarred’ which was due 30 days from the date of issue.
After failing to receive any response, Girardi was deemed ‘not eligible to practice law’ in a federal court but the state bar disbarment is still pending
Girardi’s legal troubles first started in December 2020, when a federal judge in Chicago froze his assets, and said the famed LA based lawyer had ‘misappropriated at least $2 million’ meant for the families of those killed in the Lion Air Flight 610 crash in Indonesia.
One month prior Jayne, had filed to divorce him — which many took as a ploy to preserve whatever remaining assets the former multi-millionaires had.
Disbarred: On August 19 Tom was federally disbarred according to documents filed under the Central District of California but a state disbarment is still pending; pictured June 2019