Former Mayor of New York Rudy Giuliani talks to reporters as he leaves after his defamation trial in Washington, Friday, Dec. 15, 2023. A jury awarded $148 million in damages on Friday to two former Georgia election workers who sued Giuliani for defamation over lies he spread about them in 2020 that upended their lives with racist threats and harassment. (AP Photo/Jose Luis Magana, File)
Attorneys representing a woman in California-based federal RICO class action lawsuit have filed an emergency request in Fulton County, Georgia, that seeks to “immediately to take control over the assets” of a businessman who donated to a Rudy Giuliani legal defense fund created to help the former NYC mayor fight the Georgia election workers defamation case he lost, sending him into bankruptcy.
The motion, filed Friday in Georgia state court by the firm Kneupper & Covey PC, argued that appointing a receivership is necessary to “hold and control the assets” of Matthew Martorano, his wife Kathryn Martorano, and their companies Konnektive LLC and Converging Resources Corporation, as LeAnne Tan’s RICO suit marches on in federal court.
Under Georgia law, a receiver may be appointed “[w]hen any fund or property is in litigation and the rights of either or both parties cannot otherwise be fully protected[.]”
The filing said that the RICO case became a nationwide class action in January after a judge said lead plaintiff Tan had “shown by a preponderance of the evidence that Konnektive Defendants deceived banks and credit card companies” by offering skin care product free trials in order to “fraudulently obtain the victim’s credit card or bank account information.”
“And once they have it, they begin billing their victims for subscriptions they never signed up for, never agreed to, and about which they were never properly informed,” the lawsuit reportedly said.
Attorneys A. Cyclone Covey and Kevin Kneupper maintain that appointing the law firm Robbins Alloy Belinfante Littlefield LLC as a receiver is appropriate, since the Martoranos have incentive to find ways to hide their assets in the face of a high likelihood that the RICO case will lead to a “favorable verdict” for the class, “which could easily exceed $30 million.”
In support of that claim, the lawyers said the Martoranos transferred ownership of a home to an LLC on the day of Kathryn Martorano’s Nov. 14, 2023, deposition:
Notably when questioned about the house (or houses) Mrs. Martorano owned during her November 14, 2023 deposition, her counsel objected. He first attempted to rephrase a question from Plaintiff’s counsel from “Do you have a house in Georgia right now?” to whether she “owns” a house in Georgia—a rephrasing that would give her an excuse not to disclose the house which she had transferred ownership of that day. He then instructed her not to answer any questions about homes she owned in Georgia. Mrs. Martorano refused to give any testimony about property she owned in Georgia.
When the Georgia lawsuit was first reported, Giuliani representative Ted Goodman said that the Martorano case is “unrelated” to Giuliani, but it’s possible that attorneys for Giuliani’s bankruptcy creditors may disagree.
Those lawyers for the Official Committee of Unsecured Creditors have already — and aggressively — expressed an interest in investigating the “origin” of the Rudy Giuliani Freedom Fund Legal Defense Trust Fund and Giuliani Defense, from which he “received substantial monetary support.”
“To date, the origin of these funds, the relationships between Giuliani and the donors of those funds, and any historical relationship between those assets and the assets of Giuliani or the Giuliani Businesses have not been sufficiently disclosed,” an early March filing said.
The emergency motion in Georgia speculated that Matthew Martorano may have hoped that donating to Giuliani Defense could help stave off a potential criminal case.
“It appears the Martoranos believe that a six-figure donation to Mr. Giuliani may protect them from a federal criminal indictment,” the motion surmised. “Mr. Giuliani’s role in accepting money to lobby his contacts to prevent federal prosecutions is well known in media portrayals.”
The motion asserted that the defendants “contributed $100,000 to Rudy Giuliani’s legal defense fund and at least $5,000 to the Trump Save America Joint Fundraising Committee last year—transfers that may benefit them through obtaining influence, but are wastage as to the Class as creditors.”
“It is because of the possibility of additional transfers like these that an immediate injunction is proper,” the plaintiff attorneys said, urging a court decision “as soon as possible before the Defendants hatch additional schemes to hide their assets.”
Read the emergency motion here.
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