Nike has asked a Manhattan federal judge to order fallen lawyer Michael Avenatti to pay more than $856,000 in restitution for his botched attempt to extort up to $25 million from the giant athletic apparel company.
The revised restitution request to Judge Paul Gardephe is significantly less than the $1.7 million Nike had been seeking from Avenatti, the once high-flying attorney who was convicted at trial last year of trying to shake down the company.
The lower dollar amount now sought, $856,162, was calculated after Nike removed attorney fees for the law firm Boies Schiller Flexner related to several areas of work, as Gardephe had suggested, and after Avenatti objected to those areas being factored in.
That included media monitoring, the company’s response to “Mr. Avenatti’s post-arrest attacks on the company,” as well as fees related to work whose nature has been redacted in court filings, according to a letter to Gardephe made public Thursday from Boies Schiller Flexner lawyers Peter Skinner and David Simons.
The Nike lawyers’ letter says that the company had incurred about $2.7 million in legal fees “as a result of Mr. Avenatti’s extortion.”
Prosecutors from the Manhattan U.S. Attorney’s office in a separate letter to the judge endorsed Nike’s request.
Nike seeks restitution “to be paid only after his individual victims are paid,” according to the letter, which was filed a week after Gardephe sentenced the California-based lawyer to 30 months in prison for the extortion scheme.
Avenatti has two other federal criminal cases pending, with multiple individual victims.
In a court filing later Thursday memorializing the details of Avenatti’s criminal sentence, Gardephe deferred making a determination on the amount of restitution the lawyer must pay until Oct. 8.
Avenatti, 50, was arrested in 2019 after threatening to go public with claims by a basketball coach that Nike was corruptly paying amateur players and their families unless the company signed a lucrative consulting agreement with Avenatti and another lawyer, Mark Geragos.
The bombastic Avenatti warned Nike’s lawyers that he could “take ten billion dollars off” of Nike’s stock market capitalization by publicizing the allegations.
At the time, Avenatti was widely known to the public because of numerous media appearances during his representation of porn star Stormy Daniels in legal disputes with then-President Donald Trump.
Daniels had been paid $130,000 by Trump’s then-personal lawyer Michael Cohen before the 2016 presidential election to keep her quiet about claims she once had sex with Trump, who denies her allegation.
Avenatti was convicted after trial in February 2020 of the Nike-related charges in U.S. District Court in Manhattan. Geragos was never prosecuted for his involvement in Avenatti’s effort, a factor which led Gardephe to give Avenatti less time locked up than the “substantial” prison term recommended by federal prosecutors.
“I alone have destroyed my career, my relationships and my life. And there is no doubt I need to pay,” Avenatti tearfully told Gardephe before he was sentenced.
Earlier this week, Avenatti began jury selection for a second trial, in Santa Ana, California, federal court, where he is charged with a slew of crimes, which include defrauding clients out of millions of dollars. One of those clients is a mentally ill paraplegic.
Next year, Avenatti is due to be tried in a third case, in Manhattan federal court, on charges that he swindled Daniels out of $300,000 in proceeds for a book she wrote.
Avenatti, who remains free until his Sept. 15 prison surrender day, has pleaded not guilty in his remaining criminal cases.
Source: Business - cnbc.com
