Lawyer Michael Avenatti has been found guilty on all counts of trying to extort up to $25 million from Nike, The Associated Press reported.
The jury decision in U.S. District Court in Manhattan came Friday after a three-week trial for the lawyer who gained fame representing porn star star Stormy Daniels in lawsuits against President Donald Trump. Jurors began deliberating Wednesday.
Prosecutors said he demanded that Nike pay a client of his $1.5 million and compensate him and an unidentified co-conspirator $15 million to $25 million to conduct an “internal investigation” for the company.
The lawyer allegedly had debt of over $11 million at the time of his extortion scheme.
He had met with Nike representatives on March 19 claiming to represent a youth basketball coach who had information that Nike employees made illicit payments to the families of high school athletes, and threatening to hold a news conference to expose the company unless it agreed to pay him and his client millions of dollars, according to court papers.
The next day, the FBI captured him on a recorded call hurling expletives as he pressured Nike reps to pay up, lest he tarnish the company’s reputation and trash their stock.
“I’m not f—ing around with this, and I’m not continuing to play games,” Avenatti told Nike representatives, according to court papers. “You guys know enough now to know you’ve got a serious problem. And it’s worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn’t move the needle for me.”
“This is what extortion sounds like,” Assistant U.S. Attorney Matthew Podolsky said after repeatedly playing Avenatti’s recorded demands.
Avenatti had pleaded not guilty. His lawyers said he was simply pursuing an honest negotiation with the company on behalf of a client, Gary Franklin, an amateur basketball coach who wanted Nike to clean up its act.
During closing arguments, one of his attorneys, Howard Srebnick, urged jurors to disregard the California attorney’s four-letter words. “This was exactly what the clients wanted. He acted in good faith,” Srebnick said. “Not guilty.”
“In the words of Nike itself, he went in there to ‘Just Do It,’ for his client,” he added with flourish.
But prosecutors drilled down on Avenatti’s debt, and said he was looking out for his bottom line, not his client. “Michael Avenatti, facing a mountain of debt, saw light at the end of the tunnel,” Podolsky said. “He saw a meal ticket: Gary Franklin.”
Avenatti’s former law firm office manager had testified that money was so tight there that some employees had been forced to leave their offices and work from home.
Avenatti, who was ordered jailed last month for bond violations, faces upcoming trials in two other federal criminal cases.
One, in New York, is for charges that he swindled Daniels out of $300,000 in proceeds for a book she wrote.
Anenatti is also charged in a separate case out of California with negotiating a settlement for a client and then using the funds to pay expenses for his coffee shop company, Global Barista US LLC, which operated Tully’s Coffee in California and Washington state.
Avenatti owed the IRS $850,438 in unpaid taxes, plus interest and penalties, prosecutors said.
Avenatti had pleaded not guilty to the charges. He has also pleaded not guilty to accusations wielded in a third case against him that he stole hundreds of thousands of dollars of Daniels’ book proceeds.
Daniels was owed money from a book deal, and Avenatti allegedly used a “fraudulent document purporting to bear his client’s name and signature to convince his client’s literary agent to divert money owed to Avenatti’s client to an account controlled by Avenatti,” according to a statement by federal prosecutors.
Prosecutors, who say he pocketed nearly $300,000 in the scheme, accused him of spending the money lavishly, like to pay off his Ferrari.
“No monies relating to Ms. Daniels were ever misappropriated or mishandled. She received millions of dollars worth of legal services and we spent huge sums in expenses. She directly paid only $100.00 for all that she received. I look forward to a jury hearing the evidence,” Avenatti responded when he was charged in May.
Both the case involving Daniels in New York and the case alleging fraud in Los Angeles federal court are scheduled to go to trial in the spring.
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