In a significant development, a judge has officially closed the bankruptcy case of Rudy Giuliani, the former mayor of New York City. The closure comes after a resolution was reached between Giuliani and his creditors regarding the payment of administrative expenses, which had been a major point of contention. With this order, the bankruptcy protections that allowed Giuliani to retain control over his assets have been lifted, enabling two Georgia election workers to resume their efforts to collect a $148 million defamation judgment against him.

The decision to dismiss the bankruptcy for cause was made by U.S. Bankruptcy Judge Sean Lane three weeks ago, citing Giuliani's lack of financial transparency as a key factor. However, the resolution of the expenses dispute had delayed the formal issuance of the order. Judge Lane had grown increasingly impatient with the standoff, particularly concerning Giuliani's obligations to provide funds to a court-approved firm investigating his finances, amounting to approximately $400,000.

After threats of compelling Giuliani to testify under oath about his assets, a sudden agreement was reached and a letter was filed with the court announcing the breakthrough. Judge Lane subsequently signed off on the agreement, officially dismissing the bankruptcy case and removing Giuliani's protections. This paves the way for the two Georgia election workers, Ruby Freeman and Shaye Moss, to move ahead with their attempts to collect the $148 million judgment, although the final amount recovered is expected to be significantly less.

Giuliani had filed for Chapter 11 bankruptcy soon after the jury trial in December, freezing the judgment along with other pending lawsuits against him. He disclosed $10.6 million in assets to the bankruptcy court. As per the agreement, Giuliani is required to put $100,000 in escrow, with his lawyers confirming its transfer on Tuesday. The remaining amount will be paid through the sale of either his New York apartment or his Florida condo, which comprise the bulk of his assets. If Giuliani fails to take action, Global Data Risk, the firm appointed by the creditors, can initiate a forced sale in six months.

The agreement between Giuliani and his creditors came following complaints that he was not providing sufficient information about his assets, hindering progress on the expenses issue. The creditors committee includes Moss, Dominion Voting Systems (the electronic voting machine company that also sued Giuliani over claims following the 2020 election), and Noelle Dunphy (Giuliani's former employee who filed a lawsuit alleging sexual assault, harassment, and nonpayment of wages).

While the dismissal of the bankruptcy case also unfreezes the pending lawsuits against Giuliani by Moss, Dominion Voting Systems, and Dunphy, these cases have not yet gone to trial, leaving the outcome uncertain. As the efforts to collect the defamation judgment by the Georgia election workers resume, the final amount they may recover remains to be seen.