Giuliani has proposed leaving bankruptcy as creditors are asking for a trustee to control his assets

(CNN) — Rudy Giuliani proposed to a judge he leave bankruptcy protection on Wednesday before a pivotal hearing where the former New York City mayor stands to potentially lose control of all of his assets, and he is already upset with how the proceedings are going.

His two most significant creditors, Ruby Freeman and Shaye Moss, the Georgia election workers whom he defamed, asked the bankruptcy judge in recent days to toss Giuliani out of bankruptcy, so they can pursue his assets to begin to collect the $148 million he owes them.

If the judge agrees with their plan — which Giuliani says in his new court filing he is now on board with — Freeman and Moss “are entitled to take both of his homes immediately,” in Florida and New York, their bankruptcy attorney Rachel Strickland told CNN.

The next steps are being discussed at length in a court hearing that is ongoing in federal bankruptcy court in White Plains, New York.

Giuliani’s attorney Gary Fischoff told the judge at the start of the hearing on Wednesday his team believed the purpose of Giuliani for being in bankruptcy has “run its course.”

Fischoff added the assets Giuliani has that Freeman and Moss may be able to claim immediately are jewelry and his two apartments.

Giuliani has piped up a few times in the hearing already after calling in via his iPhone, about 10 minutes late.

He is currently trying to tell the judge he believes the creditors’ committee has been defaming him, but the judge, Sean Lane, asked him not to interrupt.

If the judge does not agree to dismiss the bankruptcy case, Giuliani has asked the judge to change the classification of his bankruptcy, from Chapter 11 to Chapter 7, which would limit creditors’ ability to pursue his incoming income.

Other creditors have been arguing to the judge to remove all of Giuliani’s accounts from his control and place them under the control of a Chapter 11 trustee. That committee does not wish for Giuliani to leave bankruptcy.

“This is slick maneuvering,” Daniel Gielchinsky, a bankruptcy expert who isn’t involved in the case but following it closely, said in response to Giuliani’s 11th-hour move.

Giuliani has repeatedly said he plans to appeal the jury verdict Freeman and Moss won against him late last year, but can’t while he is in Chapter 11 proceedings.

Bernie Kerik, a close friend of Giuliani’s, told CNN on Wednesday morning that “his spirits are great.”

But “he’s frustrated with the system,” Kerik added. “He’s really frustrated by frivolous bulls***,” such as his many ongoing civil and criminal court proceedings.

The two men had spoken Tuesday night, Kerik said, but hadn’t discussed Giuliani’s bankruptcy situation.

The-CNN-Wire
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