Trump's former lawyer Giuliani stumbles in bid to appeal defamation ruling

FILE PHOTO: Former New York Mayor Rudy Giuliani departs defamation lawsuit at the District Courthouse in Washington
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By Dietrich Knauth

NEW YORK (Reuters) - A U.S. bankruptcy judge on Tuesday rejected Rudy Giuliani's attempt to appeal a $148 million defamation judgment won by former Georgia election workers, saying Donald Trump's former lawyer should focus on his own stalled bankruptcy case.

U.S. Bankruptcy Judge Sean Lane agreed with creditors, including defamed election workers Wandrea "Shaye" Moss and her mother, Ruby Freeman, who complained that Giuliani had made no progress on selling his assets or resolving his debts.

Giuliani must move on from the "appeal or bust" approach that he has taken since filing for Chapter 11 bankruptcy protection in December, the judge said during a court hearing in White Plains, New York.

"I see it as an impediment to progress in the bankruptcy," Lane said of the proposed appeal.

Giuliani needs Lane's permission to appeal the defamation judgment because his Chapter 11 filing automatically stopped all litigation against him, including the case he lost.

Lane had previously allowed Giuliani to seek a new trial or challenge the size of the judgment awarded to Moss and Freeman, whom Giuliani had falsely accused of fraud after former Republican President Trump's defeat in the 2020 election. But after a federal judge rejected Giuliani's request in April, Lane ruled that the appeal should go no further.

Giuliani had argued that appealing the defamation judgment could potentially free up resources to pay his other creditors, including other people who have sued him.

Rachel Strickland, an attorney representing Moss and Freeman, told Lane that Giuliani should not be allowed to appeal while also using his bankruptcy to avoid paying the defamation judgment and stop other lawsuits.

"Chapter 11 isn't just a place to hide out spend all your money and wait," Strickland said.

Giuliani's WABC radio show was pulled from the airwaves on Friday due to his repeated false statements about the 2020 election, and Moss and Freeman have asked Lane to enter a court order stopping Giuliani from making more defamatory statements.

"Mr. Giuliani is going in the wrong direction in terms of being able to actually work and make money," Strickland said. "He is deliberately flouting his employer's restrictions and getting fired."

Giuliani responded to the cancellation of his radio show by saying he never promised WABC that he would not talk about the 2020 election on his show.

Giuliani's attorney Gary Fischoff told Lane that he understood that a federal judge had already ruled that Giuliani's statements were defamatory.

"But does your client see it that way?" Lane asked.

Fischoff paused before answering: "I hope so.

Lane scheduled a Thursday court hearing to discuss whether he, or another judge, should rule on Giuliani's continued false statements about the 2020 election.

(Reporting by Dietrich Knauth, editing by Deepa Babington)