Michael Avenatti, who once eyed a 2020 Democratic presidential bid, was arrested and charged in two federal cases Monday — quite a downfall for an attorney who had vowed he would help send President Trump to prison.
Federal prosecutors in Manhattan charged Avenatti with attempting to extort millions of dollars from Nike if his demands were not met.
Avenatti attempted to extract the money “by threatening to use his ability to garner publicity to inflict substantial financial and reputational harm on the company if his demands were not met,” prosecutors said in a statement.
[Related: Stormy Daniels on legal actions after Avenatti: ‘It’s about to get real f–king good’]
Avenatti and an unnamed co-conspirator, who the Wall Street Journal reported is CNN legal analyst Mark Geragos, threatened to hold a news conference on the eve of Nike’s quarterly earnings call and the start of the National Collegiate Athletic Association tournament to publicize alleged misconduct and maximize the damage such information could inflict on the company.
Avenatti said he had a client, an Amateur Athletic Union basketball coach, who had evidence that Nike paid recruits in exchange for their commitments to college teams sponsored by Nike.
If Nike’s lawyers wanted them to remain quiet, Avenatti said, they would need to be paid between $15 million and $25 million to conduct an “internal investigation” into the athletics apparel company. Avenatti said they would agree to a $22.5 million hush-money payment from Nike if the company did not want to keep them on retainer.
The outspoken lawyer met or spoke with Nike’s lawyers several times over the last week to discuss the demands. After a meeting on March 19, Nike’s lawyers contacted prosecutors in New York regarding Avenatti’s threats. Some of the discussions with Avenatti were recorded by law enforcement.
“I’m not fucking around with this, and I’m not continuing to play games,” Avenatti said during a March 20 phone call. “I’ll go take a billion dollars off your client’s market cap. But I’m not fucking around.”
At a meeting on March 21, Avenatti again threatened to go public with the information if Nike’s lawyers did not pay up.
“As soon as this becomes public, I am going to receive calls from all over the country from parents and coaches and friends and all kinds of people — this is always what happens — and they are all going to say I’ve got an email or a text message or — now, 90 percent of that is going to be bullshit because it’s always bullshit 90 percent of the time, always, whether it’s R. Kelly or Trump, the list goes on and on — but 10 percent of it is actually going to be true,” he said.
The two sets of lawyers met Monday, the deadline Avenatti gave Nike’s lawyers to make a decision.
Two hours after that meeting, according to the criminal complaint, Avenatti teased a news conference, scheduled for Tuesday, “to disclose a major high school/college basketball scandal perpetrated” by Nike.
“This criminal conduct reaches the highest levels of Nike and involves some of the biggest names in college basketball,” Avenatti tweeted, less than an hour before the New York charges were revealed.
Avenatti, 48, was also charged with federal bank fraud and wire fraud charges in Los Angeles.
The U.S. Attorney’s Office for the Central District of California alleges Avenatti embezzled a client’s money to pay his own expenses and debts, as well as those of his law firm and coffee business. He is also accused of defrauding a bank by using fraudulent tax returns to obtain millions of dollars in loans.
Prosectors allege Avenatti used his client’s $1.6 million settlement to pay his own expenses and the expenses for his coffee business, Global Baristas US LLC. He also allegedly defrauded a bank in Mississippi by providing the lender with false tax returns to obtain three loans totaling $4.1 million for his law firm and coffee business in 2014.
He faces a maximum of 50 years in prison in the California case and a maximum of 47 years behind bars for the charges in New York.
After rising to prominence representing porn star Stormy Daniels in her cases against Trump, it was announced this month that he was no longer representing her. The attorney said his law firm had parted ways with the porn star “for various reasons,” but Daniels indicated she would have fired him if he had not resigned.
“Knowing what I know now about Michael Avenatti, I am saddened but not shocked by news reports that he has been criminally charged today,” Daniels said in a statement, adding that he had been “extremely” dishonest with her.
“There will be more announcements to come,” she said.
During the height of the public attention surrounding his representation of Daniels, Avenatti grew increasingly outspoken about political issues. He openly pondered a run for the 2020 Democratic presidential nomination, but ultimately said he would not be a candidate.
He made that decision after facing growing legal troubles, including an arrest after an alleged altercation with his former girlfriend.
In October, then-Senate Judiciary Chairman Chuck Grassley, R-Iowa, referred Avenatti and another one of his clients, Julie Swetnick, to the Justice Department, accusing them of knowingly making false statements to Congress during the confirmation hearings of Supreme Court Justice Brett Kavanaugh.
