In a recent development, a judge has indicated that he is leaning towards dismissing Rudy Giuliani's bankruptcy case. This decision comes after lawyers for the cash-strapped former New York City mayor and his main creditors, two ex-Georgia election workers who secured a $148 million defamation judgment against him, agreed that dismissal is the best way forward.

The case has been marred by allegations from creditors that Giuliani is disregarding bankruptcy laws and potentially hiding assets. If the case is dismissed, it would put an end to his pursuit of bankruptcy protection. However, it would not absolve him of his debts, as his creditors could pursue other legal remedies to recoup some of the money owed to them.

U.S. Bankruptcy Judge Sean Lane stated during a recent hearing that he plans to issue a decision by the end of the week. He has scheduled a hearing for Friday, where he may make his ruling. The judge ruled out converting the case to a liquidation, rejecting Giuliani's proposal, stating that it would not be in the best interest of the parties owed money.

Judge Lane expressed concerns about Giuliani's lack of transparency throughout the proceedings, citing it as a reason for leaning towards dismissal. Giuliani's lawyer, Gary Fischoff, argued that dismissing the case would allow the former mayor to pursue an appeal in the defamation case linked to his efforts to overturn Donald Trump's 2020 election loss. Another option discussed was appointing a court-appointed trustee to take control of Giuliani's assets while the Chapter 11 case continues.

One of the lawyers representing ex-election workers Ruby Freeman and Wandrea "Shaye" Moss accused Giuliani of using the bankruptcy process as a "bad-faith litigation tactic," claiming that he sees the court as a means to evade his creditors. The lawyer emphasized that in the real world, all dollars are fair game and Giuliani should be held accountable for his debts.

During the hearing, Giuliani interrupted and called the comments made by Freeman and Moss' lawyer "highly defamatory." Lane scolded Giuliani for interrupting, while Philip Dublin, a lawyer for a committee of Giuliani's other creditors, expressed the committee's preference for keeping the bankruptcy case ongoing with the appointment of a trustee.

Giuliani filed for Chapter 11 bankruptcy reorganization in December, shortly after Freeman and Moss won their defamation case. They alleged that Giuliani's actions, fuelled by Trump's baseless claims of election fraud, led to death threats against them. Earlier this month, Giuliani requested to convert the case to a Chapter 7 liquidation, but he later reconsidered and pushed for dismissal instead, citing the significant administrative fees associated with liquidation.

If the bankruptcy case is dismissed, Freeman and Moss could bring their collection efforts for the $148 million judgment back to court in Washington, D.C., where they initially achieved victory, thus avoiding further legal fees in bankruptcy court. Additionally, a dismissal would come with a 12-month ban on Giuliani filing for bankruptcy protection again.

Giuliani's bankruptcy is just one of several legal troubles he currently faces. Last week, he was disbarred as an attorney in New York after repeatedly making false statements about Trump's 2020 election loss. He also faces the possibility of losing his law license in Washington, as recommended by a board in May. Furthermore, he is facing criminal charges in Georgia and Arizona related to his involvement in the effort to overturn the 2020 election results.

According to Giuliani's financial filings in the bankruptcy case, he listed nearly $153 million in existing or potential debts, including tax liabilities and potential lawsuit judgments. However, he claimed to have assets worth $1 million to $10 million. His most recent financial filings indicate that he had approximately $94,000 cash on hand at the end of May, with his company, Giuliani Communications, having around $237,000 in the bank. His main source of income over the past two years has been a retirement account, which had a balance of just over $1 million in May.

Judge Lane's forthcoming decision on the dismissal of Giuliani's bankruptcy case could have significant implications for both Giuliani and his creditors. As the legal battles continue, Giuliani finds himself grappling with the repercussions of his actions and the pursuit of financial stability.