SANTA ANA, California—One week after authorities arrested Michael Avenatti in New York City on charges of extortion, the celebrity lawyer appeared in federal court here on Monday on one of two indictments—this time finding himself the defendant in a raucous arraignment instead of the defender.
Among other crimes, federal prosecutors alleged that Avenatti had attempted to “shake down” Nike executives, threatening to publicize damaging information unless they turned over more than $20 million. Following his arrest on March 25, Avenatti surrendered his passport and was released from New York jail later that day on a $300,000 bond. The lawyer maintains his innocence on all counts.
On Monday afternoon, wearing a navy suit and blue striped tie, Avenatti sat in court beside his attorney, John Littrell, a well-known litigator who specializes in fraud. Judge John D. Early apprised Avenatti of his rights and asked whether he had read the 184-page complaint from California federal prosecutors.
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“I understand the content of the document,” Avenatti said.
The long legal file details counts of wire and bank fraud, which are separate from his charges in New York. California prosecutors claim that the media-friendly lawyer misappropriated $1.6 million in settlement money. They say he funneled the funds into his coffee business and personal expenses, rather than into his client’s account. When the client later asked about their money, Avenatti reportedly “advanced” the client $130,000. “In essence, it appears Michael Avenatti loaned the client’s own money to his client,” Los Angeles federal prosecutor Nick Hanna told reporters at a press conference last week.
The complaint also alleges that Avenatti lied on three separate bank loan applications totaling $4.1 million, claiming that he had an average annual income of between $4 and $5 million for the years 2011-2013, and that he had paid $2.5 million in federal taxes those years. In fact, he is accused of paying no federal taxes at all those years.
After reviewing the charges, Littrell and federal prosecutor Julian Andre agreed to the same conditions outlined in Avenatti’s New York bail agreement. The lawyers disagreed briefly, because prosecutors had submitted a long list of potential victims and witnesses with whom Avenatti was not to have contact.
“This list is very broad,” Avenatti’s attorney told the judge. “There are some we need to include. But we hope to work it out.”
In the end, Judge Early agreed to continue the same conditions and bond that the celebrity lawyer had agreed to in New York.
Avenatti also waived his right to a pre-trial hearing. Littrell noted that they would be entering a not-guilty plea at a later court date, at which Avenatti would not be present. He will appear next on April 29 for a post-indictment arraignment.
As he left the courthouse, Avenatti attempted to address a crowd of reporters, but was interrupted by warring hecklers, with one man howling that he was a “creepy porn lawyer” and another yelling adulation.
“Lock him up!” called the first.
“I love you, Michael!” the second countered.
The dueling cries captured competing visions of the well-known attorney, who rose to national fame representing adult actress Stormy Daniels in her case against Donald Trump, but whose recent legal troubles have soured his national profile.
“I have fought for Davids and Goliaths in front of judges sitting in courthouses just like this,” Avenatti yelled over the din. “I will now stand the time in connection with this case and the case in New York, relying in that same justice system that I have subjected myself to. I am highly confident that when the process plays out that justice will be done.”
