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Michael Avenatti accused of extortion and filing fake tax returns

Viewers of cable news in Texas may have become familiar with Michael Avenatti over the past year as the lawyer represented an adult entertainment actress in a legal dispute against President Donald Trump. The lawyer now stands accused of attempting to extort millions of dollars from the athletic apparel company Nike. He was arrested after Nike executives alerted federal authorities. He arranged his release from jail with a $300,000 bond. In his statement to the media, he insisted that he would clear his name.

Claiming to represent the coach of an amateur basketball program funded by Nike, Avenatti threatened to make public alleged misconduct by Nike employees unless the company paid him $22 million to keep quiet. He reportedly gave the company the option to hire him for $15 million to $25 million to investigate the misconduct.

These allegations represent only a part of his legal troubles. Federal investigators on the West Coast have been building a tax fraud case against him for the past year. He allegedly filed fraudulent tax returns that inflated his income to $14 million over three years to secure $4 million in loans from a bank. Convictions on some or all of the charges could send him to prison for decades.

The long prison sentences associated with federal crimes make the stakes very high for a person accused of criminal activity. The representation of a lawyer familiar with the federal system may provide crucial guidance when someone must prepare for trial or consider a plea deal. A lawyer might improve someone's position by striving to cast doubt on the evidence.

Source: Associated Press, "Avenatti hit with Nike extortion claims, other charges", Brian Melley and Larry Neumeister, March 26, 2019

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