NEW YORK — Michael Avenatti, the brash California lawyer who once represented Stormy Daniels in lawsuits against President Donald Trump, appeared in federal court Thursday for sentencing on charges that he tried to extort millions of dollars from Nike by threatening the company with bad publicity.
Over a year after a jury convicted Avenatti, U.S. District Judge Paul G. Gardephe is scheduled to impose a sentence in Manhattan after hearing arguments from lawyers and giving Avenatti a chance to speak.
Avenatti was convicted on charges that he tried to extort up to $25 million from the Beaverton, Oregon-based sportswear giant when he represented a Los Angeles youth basketball league organizer upset Nike had ended its league sponsorship.
Criminal fraud charges on two coasts disrupted Avenatti’s rapid ascent to fame. Regardless of the outcome at Thursday’s hearing, he faces the start of a fraud trial next week in the Los Angeles area, a second California criminal trial later this year and a separate trial next year in Manhattan, where he is charged with cheating Daniels out of hundreds of thousands of dollars.
Avenatti, 50, represented Daniels in 2018 in lawsuits against Trump, appearing often on cable news programs to disparage the Republican president. Avenatti explored running against Trump in 2020, boasting that he would “have no problem raising money.” Daniels said a tryst with Trump a decade earlier resulted in her being paid $130,000 by Trump’s personal lawyer in 2016 to stay silent. Trump denied the affair.
Those political aspirations evaporated when prosecutors in California and New York charged Avenatti with fraud in March 2019. California prosecutors said he was enjoying a $200,000-a-month lifestyle while cheating clients out of millions of dollars and failing to pay hundreds of thousands to the Internal Revenue Service.
Charges alleging he cheated Daniels out of proceeds from a book deal followed weeks later. Avenatti pleaded not guilty to all charges.
Prosecutors have requested a “very substantial” sentence, citing the U.S. Probation Department’s recommendation of an eight-year prison term. Avenatti’s lawyers said six months in prison and a year of home detention was enough punishment.
On Tuesday, Gardephe rejected a request by Avenatti’s lawyers to toss out his conviction in the Nike case on attempted extortion and honest services wire fraud charges. The judge wrote that evidence showed that Avenatti “devised an approach to Nike that was designed to enrich himself” rather than address his client’s objectives.
In written sentencing arguments, prosecutors said Avenatti tried to enrich himself by “weaponizing his public profile” to try to force Nike to submit to his demands.
In a victim-impact statement, Nike’s lawyers said Avenatti did considerable harm to the company by falsely trying to link it to a scandal in which bribes were paid to the families of NBA-bound college basketball players to steer them to powerhouse programs. An employee of Adidas, a Nike competitor, was convicted in that prosecution.
The lawyers said Avenatti threatened to do billions of dollars of damage to Nike and then falsely tweeted that criminal conduct at Nike reached the “highest levels.”
Avenatti’s former client, Gary Franklin Jr., said in a statement submitted by prosecutors that Avenatti’s action had “devastated me financially, professionally, and emotionally.” Franklin was expected in court Thursday.
In their presentence submission, Avenatti’s lawyers said their client had suffered enough, citing enormous public shame and a difficult stint in jail last year that ended after lawyers said he was particularly vulnerable to the coronavirus.
“Avenatti’s epic fall and public shaming has played out in front of the entire world. The Court may take judicial notice of this fact, as Avenatti’s cataclysmic fall has been well-documented,” the lawyers wrote.
Although prosecutors asked Gardephe to impose a $1 million restitution order to help cover Nike’s legal expenses, Avenatti’s attorneys cited the lack of financial losses as a reason for leniency.
“There was no financial loss to any victims so there is no restitution in this case,” they wrote. “The fact that a white collar federal criminal case was brought despite this fact is itself an important mitigating factor.”
