Tough-talking, Trump-critiquing attorney Michael Avenatti is facing federal charges in two states over alleged schemes to extort Nike and to commit bank and wire fraud.
Complaints unsealed in New York and California on Monday are ripe with the colorful details we’ve come to associate with the lawyer best known for representing Stormy Daniels, the adult film actress paid to keep silent about her alleged affair with the President.
Avenatti was arrested Monday in New York and remains in federal custody for now.
In the case brought by the Manhattan U.S. Attorney, Avenatti and an unnamed co-conspirator threatened to release information that would gravely damage Nike’s reputation unless the pair received multi-million dollar payments from the athletic apparel giant. Avenatti, who was charged with multiple counts of extortion, claimed he was representing the coach of a men’s basketball amateur athletic union program whose sponsorship agreement with Nike had recently come to an end, according to court documents.
Avenatti told two attorneys hired by Nike that the coach “had evidence that one or more Nike employees had authorized and funded payments to the families of top high school basketball players and/or their families” and tried to conceal that scheme, according to the complaint.
In a March 19 meeting, the pugnacious attorney allegedly said that unless the company paid him handsomely, he would hold a press conference divulging the sordid details just ahead of Nike’s quarterly earnings call and the start of the annual, lucrative National Collegiate Athletic Association tournament. Specifically, the complaint says Avenatti and his co-conspirator asked for their client to receive $1.5 million and for Nike to hire the pair of them—to the tune of between $15 to $25 million—to conduct an internal investigation of the allegations.
The Nike lawyers promptly contacted the Manhattan U.S. Attorney’s office. Prosecutors recorded a series of phone calls and an in-person meeting that Avenatti and his co-conspirator held with the Nike team over the next two days as they discussed the details of the agreement.
“It’s worth more in exposure to me to just blow the lid on this thing,” Avenatti allegedly said in one March 20 call, according to the complaint, warning the Nike lawyers he would “go take ten billion dollars off your client’s market cap.”
“I’m not fucking around with this,” Avenatti allegedly warned.
Avenatti used that line again — repeatedly — during a March 21 meeting recorded by law enforcement in which he said he “held the balls of the client” in his hands, per the complaint.
When the Nike attorneys expressed hesitation about retaining Avenatti for a lengthy internal investigation, Avenatti allegedly said he would also accept a $22.5 million confidential settlement that would allow him to “ride off into the sunset.”
If things did not go his way, he warned, according to the complaint, “They are going to incur cut after cut after cut after cut, and that’s what’s going to happen as soon as this thing becomes public.”
Avenatti tweeted that there would be more to come in the college basketball corruption scandal on Thursday, and on Monday afternoon, took to the platform to announce the press conference about a “major” Nike scandal. He was arrested less than an hour later.
The California case involves charges that date back to a period from 2014 to 2016, before Avenatti was a household name. The 197-page complaint charges Avenatti with defrauding a Mississippi bank to “obtain three loans totaling $4.1 million” and with embezzling a client’s settlement money to pay expenses for his troubled coffee business.
Avenatti is accused of lying about his income to obtain the loans from the Mississippi-based Peoples Bank in 2014. Avenatti allegedly provided the bank with false tax returns showing that he’d earned over $14 million over the past three years when, in fact, he never filed tax returns for those years at all.
He also allegedly misused some $1.6 million from a client’s settlement to cover “expenses for his coffee business, Global Baristas US LLC, which operated Tully’s Coffee stores in California and Washington state, as well as for his own expenses,” Southern California prosecutors said in a statement.
The serious charges laid out in the two cases represent an embarrassing fall for the attorney best known for representing Stormy Daniels in her crusade to tell the full story of how she received hush money from Trump.
In a statement, Daniels said she was “saddened but not shocked” by the criminal charges.
“I made the decision more than a month ago to terminate Michael’s services after discovering that he had dealt with me extremely dishonestly and there will be more announcements to come,” Daniels said on Twitter.
Avenatti tried to parlay his notoriety from the Daniels case to insert himself into other high-profile legal battles. He represented one of the women who accused Supreme Court Justice Brett Kavanaugh of sexual misconduct during his confirmation hearings, and he represented a migrant family separated at the U.S.-Mexico border by the Trump administration.
Avenatti even floated a 2020 presidential run, framing himself as a “fighter” candidate who could help lead the Democratic charge against Trump.
Trump supporters framed Avenatti’s arrest as the cherry on top of a weekend that saw special counsel Robert Mueller’s investigation come to an end with the conclusion that the Trump campaign did not coordinate with Russia in 2016.
Read the full complaints below: