Trump adversary Avenatti stole from Stormy Daniels, prosecutor says

NEW YORK, Jan 24 (Reuters) – U.S. lawyer Michael Avenatti, a fierce critic of former President Donald Trump, went on trial on Monday over claims he stole nearly $300,000 from his onetime client, the adult film star Stormy Daniels.

Prosecutors say Avenatti, who has pleaded not guilty, embezzled book contract proceeds intended for Daniels, in part by forging her signature in a letter to an agent.

“This is a case about a lawyer who stole from his client. A lawyer who lied to cover up the scheme,” Assistant U.S. Attorney Andrew Rohrbach said in his opening statement. “The defendant stole almost $300,000 from the person he was supposed to be looking out for.”

Avenatti, 50, said in a statement over the weekend that he was “completely innocent of these charges.” Avenatti became a cable TV fixture when he represented Daniels, whose real name is Stephanie Clifford, in cases against Trump.

Daniels said she had a sexual liaison with Trump and received $130,000 before the 2016 presidential election in exchange for not discussing her encounter with Trump, who denies it happened. Avenatti represented her in a lawsuit seeking to invalidate the nondisclosure agreement, which Daniels won, and a defamation case against Trump, which she lost.

Michael Cohen, Trump’s former personal attorney who made the so-called hush money payment to Daniels, was present in the courtroom on Monday.

Rohrbach said Daniels paid Avenatti $100 to represent her in cases against Trump, and authorized him to raise further funds from the public to pay his expenses. But he said there was no agreement for Avenatti to receive payments under Daniels’ contract to publish her memoir, titled “Full Disclosure.”

Defense attorney Andrew Dalack countered that Avenatti was entitled to a “reasonable percentage” of the proceeds from Daniels’ book and was authorized to accept payments on her behalf. The dispute, Dalack said, “has no business in federal criminal court.”

“What we have in this case is a disagreement, a fee dispute between an attorney and his disgruntled former client,” Dalack said in his opening statement.

Avenatti faces up to 22 years in prison if convicted of wire fraud and identity theft.

The trial in Manhattan federal court is the latest in a slew of legal troubles that have cost Avenatti his legal career, which ended abruptly in 2019 when prosecutors in New York and California brought dozens of criminal charges that could land him in prison for the rest of his life.

Avenatti is appealing a February 2020 conviction and 2-1/2-year prison sentence for trying to extort up to $25 million from Nike Inc by threatening to expose its alleged corrupt payments to families of college basketball prospects unless it hired him to conduct a probe. read more

Nike denied wrongdoing.

Avenatti is separately facing federal wire fraud charges in California from prosecutors who say he embezzled nearly $10 million from five clients.

Since his March 2019 arrest in the Nike case, Avenatti has spent most of his time confined at a friend’s California home.

Reporting by Luc Cohen and Jonathan Stempel in New York; Editing by Noeleen Walder, Cynthia Osterman and Howard Goller

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