REPORT: Erika Jayne Facing Possible Jail Time and New $5.4 Million Lawsuit Over Refusal to Turn Over Diamond Earrings as RHOBH Star’s Attorney Speaks

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REPORT: Erika Jayne Potentially Facing New $5.4 Million Lawsuit Over Not Returning Diamond Earrings, As Her Lawyer Claims She Has No Obligation to Do So Due to Statute of Limitations

Real Housewives of Beverly Hills star Erika Jayne has found herself embroiled in yet another lawsuit — a $5.4 million dollar lawsuit to be specific. This time, it’s over her diamond earrings, which are now worth $1.4 million.

In new documents obtained by Radar Online, the trustee presiding over the Girardi Keese embezzlement/bankruptcy case wants to auction off the diamond earrings in an effort to pay back Erika’s estranged husband Thomas Girardi’s creditors and lawsuit victims, who “suffered serious health issues from their use of the drug Rezulin.”

As we previously reported, Erika has refused the request to hand over the earrings in question, saying, “During our marriage, I believed [Tom Girardi] and [his firm] were financially successful, extremely wealthy, and made large amounts of money.” The RHOBH star claims that because the earrings were a gift, she has no knowledge of how they were paid for.

The “XXPEN$IVE” singer’s lawyer has since argued that the statute of limitations has run out on the claims brought forth by the trustee, so there can be no “new case” against Erika.

The earrings in question are currently being held in a safety deposit box, where Erika’s lawyer says they intend to stay until the outcome of the case.

However, the trustee is firing back, claiming that Erika should not be allowed to “keep the fruits of her husband’s poisonous tree because of the time that has passed since the crime occurred.”

The trustee filed a motion, claiming, “At that time, [Jayne] had an obligation to return the earrings to the Trustee. She did not, and the Trustee was compelled to file her Motion. [Jayne’s] response, because of the passage of time, she gets to keep the fruit of the embezzlement. Not so.”

The motion continued by claiming, “every person who withholds any property from the owner . . . knowing the property to be stolen. . .. shall be punished by imprisonment in a county jail for not more than one year, or imprisonment pursuant to subdivision (h) of Section 1170.”

The trustee is now accusing Erika’s conduct of being a “new crime” as she has the ability to pay back damages but is selfishly refusing to do so.

“Her conduct appears to be a new crime,” the trustee wrote. “Her refusal to now turn over the Diamond Earrings is conversion, for which she can be held accountable in damages. She can also be civilly liable for the value of the Diamond Earrings, plus statutory interest and punitive damages, which with prejudgment interest could easily be $5.4 million.”

Erika’s lawyer has fired back by saying that Erika has fully cooperated with the trustee and there is no evidence of a “new crime.”

“The trustee for Girardi Keese (GK) stands in the shoes of the law firm, and inherits GK’s knowledge of the transaction in 2007, which involved a check written by two GK partners. The clock began to run in 2007 and all statutes of limitation have expired. The “new crime” allegation is meritless.”

Erika’s attorney added, “As the GK trustee knows, Erika offered to put the earrings in an escrow pending a final judicial resolution. And guess what? The GK trustee took us up on that offer and the earrings are in a safe deposit box to which the GK trustee has the key, pending a final decision. Not exactly a new crime.”

The attorney also brought up questions as to why everyone is “piling up” on Erika for her husband’s alleged crimes.

“Once again, everyone piles on Erika, this time for actions of her ex-husband of 15 years ago about which she had no knowledge whatsoever. Why aren’t the trustees going after Tom Girardi or the estate of Mr. O’Callahan, the other GK partner who signed the check in 2007? Putting the blame on Erika, an entertainer without a law degree who never worked at the law firm, is a diversion tactic. Why not focus on all the attorneys, accountants, and funders who were closer to TG and GK’s inside operations?” he asked.

This is all coming out after Erika recently stated that she refuses to stop paying for her $40,000 glam team as it’s “art” and a “lifestyle” to her, and she’s “downsized” enough. She also states that she doesn’t have the ability to pay the California Tax Board the $2.2 million in back taxes.