After Tough Hearing, Avenatti Withdraws Effort To Intervene In Cohen Case

NEW YORK, NY - MAY 30: Michael Avenatti, lawyer of adult-film actress Stormy Daniels exits the United States District Court Southern District of New York on May 30, 2018 in New York City. According to a filing submi... NEW YORK, NY - MAY 30: Michael Avenatti, lawyer of adult-film actress Stormy Daniels exits the United States District Court Southern District of New York on May 30, 2018 in New York City. According to a filing submitted to the court Tuesday night by special master Barbara Jones, federal prosecutors investigating Michael Cohen, a longtime personal lawyer and confidante for President Donald Trump, are set to receive 1 million files from three of his cellphones that were seized last month. (Photo by Eduardo Munoz Alvarez/Getty Images) MORE LESS

After a contentious federal court hearing, Michael Avenatti, the lawyer for Stormy Daniels, on Wednesday withdrew his motion to be allowed to intervene in the case arising out of an ongoing criminal probe into Michael Cohen’s business dealings.

Avenatti argued in court filings and in a court hearing earlier Wednesday that he wanted to be able to protect Daniels’ privileged communications with Keith Davidson, the attorney who represented her when she made her October 2016 hush money agreement with Cohen, President Trump’s longtime fixer. 

But at the hearing, U.S. Judge Kimba Wood expressed concern about Avenatti’s outsized media presence and frequent public criticisms of Cohen. And lawyers for Cohen argued strongly against allowing Avenatti to intervene.

Daniels says she had an affair with Trump, which Trump denies. She wants to be released from the agreement, allowing her to speak publicly about the alleged affair.

Ahead of the hearing, Avenatti had accused Cohen’s team of selectively leaking to the media a recorded conversation that may have pertained to his client. Avenatti elaborated Wednesday that he’d received calls from journalists about a taped conversation between Davidson and Cohen regarding information that ought to have been privileged between Davidson and Clifford.

“Why would Davidson be having these discussions” with Cohen? Avenatti wondered aloud. Daniels, he assured the court, had never waived her attorney-client privilege with Davidson.

The recording, Avenatti posited, “had to have come from Michael Cohen, or someone associated with Michael Cohen.”

Later, Cohen lawyer Stephen Ryan said any such recordings would be under “lock and key” at his office. The leak Avenatti alleged “had not occurred,” Ryan said, and he was “unaware of the release of any audio at this time.”

Avenatti claimed victory after the hearing Wednesday, asserting that Cohen’s lawyers had confirmed the existence of the privileged audio recordings. But it was unclear whether Ryan had confirmed the tapes’ existence or merely confirmed that his team was being careful to protect the files seized in the the April raids, whatever those files may be. 

Raising his voice at times, Ryan said that in 27 years, he hadn’t opposed a lawyer’s motion to intervene, but that Avenatti had turned the case “on its head” with his outsized media presence and the release recently of an unsourced document detailing much of Cohen’s post-election consulting deals with huge corporations like AT&T and Novartis. Ryan said it was “inevitable” that the document was based on an illegally leaked Suspicious Activity Reports, the highly sensitive documents banks use to flag fishy behavior.

The same document, Ryan said, had constituted a “drive-by shooting of anyone named ‘Michael Cohen”. The document mistakenly listed the financial data of other people named Michael Cohen. The move, Ryan said, was “entirely reckless and improper.”

Ryan also brought up the recent $10 million judgement against Avenatti’s firm, Eagan Avenatti, which he said showed Avenatti “cannot keep his agreements.”

Avenatti argued in response — after calling Ryan’s remarks “quite the tale,” earning a quick rebuke from Wood — that Eagan Avenatti was irrelevant to the hearing at hand, because it was not involved in Daniels’ representation.

In response, Trump lawyer Joanna Hendon accused Avenatti of obscuring the fact that lawyers from the firm were in fact involved in Daniels’ representation. She presented emails to Wood that she said showed as much.

“I have no idea what this is,” Avenatti objected as Hendon passed on the documents.

“You don’t need to speak yet,” Wood responded quickly. 

That exchange typified Wood’s tone toward Avenatti Wednesday.

Acknowledging that she had no say over Avenatti’s media presence, Wood said she didn’t want Avenatti to be in a “limbo” in which he could “denigrate” Cohen and therefore “potentially deprive him of a fair trial, if there is one,” by tainting the jury pool.

She emphasized at one point that Avenatti would need to play by the rules were he admitted to argue in the case, including those against potentially prejudicial comments outside of court — a reference to Avenatti’s frequent cable news appearances. On that point, Wood said Avenatti would need to stop his “publicity tour” were he to involve himself in the case at hand.

“I say publicity tour not in a derogatory sense,” she said. “You’re entitled to publicity. I can’t stop you, unless you’re participating in a matter before me.” 

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