Avenatti arrested and charged with extortion, embezzlement, bank and tax fraud
Celebrity lawyer Michael Avenatti, the subject of two separate criminal investigations, was arrested Monday in New York, where federal prosecutors in the Southern District charged him with attempting to extort more than $20 million from Nike.
In an unrelated case, the U.S. attorney in Los Angeles charged him with embezzlement, bank and tax fraud.
Avenatti, who represented porn star Stormy Daniels in a lawsuit against President Trump that sought to free her from a nondisclosure agreement, faces a maximum sentence of 47 years in prison for the charges filed in New York, and another 50 years for those filed in California.
“This was an old-fashioned shakedown,” Geoffrey Berman, U.S. attorney for the Southern District of New York told reporters at a Monday press conference.
Detailing a plot hatched only a week ago, Berman said Avenatti approached Nike on March 19, the eve of the NCAA men’s basketball tournament and ahead of the company’s quarterly earning’s call, saying he represented a client who coached a high school basketball team.
According to the indictment, Avenatti told Nike’s lawyers he had evidence of illegal payments by the company to student athletes. He threatened to publicize these at a press conference, and demanded millions of dollars, for his client and himself, in exchange for keeping quiet.
Nike, Berman said, contacted law enforcement and the FBI then recorded all subsequent conversations between Nike lawyers and Avenatti.
On March 20, prosecutors said, Avenatti further detailed his threat.
“I’ll go take 10 billion dollars off your client’s market cap. … I’m not f***ing around,” Avenatti told Nike’s lawyers, according to the complaint.
“The entire scheme played out in less than a week,” Berman said, who added that Avenatti “was seeking money for himself.”
As the discussions between the two parties continued, Avenatti posted a tweet that Berman said was meant as a warning to Nike.
Something tells me that we have not reached the end of this scandal. It is likely far far broader than imagined…https://t.co/iPH2Q9yVY6
— Michael Avenatti (@MichaelAvenatti) March 21, 2019
Avenatti was arrested Monday in Manhattan, shortly after he posted a tweet in which he promised to detail his charges against Nike at Tuesday news conference.
Tmrw at 11 am ET, we will be holding a press conference to disclose a major high school/college basketball scandal perpetrated by @Nike that we have uncovered. This criminal conduct reaches the highest levels of Nike and involves some of the biggest names in college basketball.
— Michael Avenatti (@MichaelAvenatti) March 25, 2019