Michael Avenatti surrendered at the federal courthouse in Santa Ana on Monday, ending nearly two years of COVID-related home confinement after a New York City jury convicted him of defrauding Stormy Daniels during their 2018 domination of cable TV news.
He’ll celebrate his 51st birthday next Wednesday behind bars, likely in Los Angeles, and he’s unlikely to see freedom again at least several years, with a 30-month federal sentence pending for his February 2020 convictions for extorting Nike and another prison sentence scheduled to be determined May 24 for defrauding Daniels of money owed to her through a book deal.
Avenatti arrived at the Orange County federal courthouse about 4:15 p.m. PST in a black Buick Enclave driven by a paralegal working his California case, which involves allegations that he stole $10 million from five clients and could carry many more years in prison if convicted. A bifurcated part of the case includes tax and bankruptcy fraud charges. All of it is under appeal to the U.S. 9th Circuit Court of Appeals, and Avenatti’s lawyers filed their reply to prosecutors’ brief about an hour before he turned himself in.
Asked where he is Tuesday, Avenatti’s standby counsel in California, Dean Steward, said “at the moment MDC.” He declined further comment.
The core legal issue in the 9th Circuit appeal involves Avenatti’s argument that he can’t be retried because of a mistrial in August prompted by client billing information stored on his law firm servers seized by the U.S. Department of Justice but not released to him before trial. Prosecutors in the Southern Division of New York, the so-called Mother Court of the American judiciary, managed to keep the issue out of their trial, arguing their case was a straight contract issue that didn’t involve client billing, so costs associated with his representation of Daniels are irrelevant. The judge in that case, U.S. District Judge Jesse Furman agreed, noting that Avenatti has had the full server data since September and calling it “a red herring. A distraction. Smoke and mirrors.”
“I don’t know what metaphor you want to use,” Furman said.
The two-week trial introduced the Manhattan jury to an array of Southern California landmarks, including the Montage in Laguna Beach, where Aveantti’s law firm holiday party was held in 2017, the Fashion Island shopping center area where his bankrupt law firm was evicted from its office high rise, and the now-defunct Girardi Keese party at the California plaintiff’s bar annual mass torts conference in Las Vegas, where Avenatti lamented his financial woes to a friend.
It also introduced to the jury a lengthy description in their written instructions of the California State Bar duties Avenatti had been sworn to uphold, and it put Avenatti and Daniels in the same air as Trump’s former lawyer who paid Daniels the hush money over her affair with Trump, Michael Cohen, with Cohen snagging a rare public courtroom seat for Daniels’ testimony .
Avenatti’s fraud against Daniels involved her publishing deal for her book Full Disclosure, which promised her $800,000 in four payments, minus a 15 percent fee for her literary agent, Luke Janklow of the Manhattan firm his father founded, Janklow & Nesbit. But as established in trial, Avenatti formed a fast friendship with Janklow, and he persuaded him not to discuss finances with Daniels while redirecting her second and third payments to a new account in his name.
Janklow was a key prosecution witness, too, taking the stand as the first trial witness and testifying about messages between himself and Avenatti that showed Janklow was smitten with Avenatti and believed him to be a “stone-cold mother fucking professional” and a modern day Clarence Darrow when in fact Avenatti was using Janklow to defraud Daniels.
Janklow told Avenatti in one message displayed in court: “You are not dependent on stormy. She was the foot you kicked down the door with,” and testimony revealed Avenatti at one point had a $2 million book deal with Janklow, but he only collected $475,000 and the book never happened. Janklow never said why: Furman halted the questioning at the request of Avenatti’s defense.
Janklow stuck with Avenatti into February 2019 but eventually provided Daniels an accounting of her payments after the book publisher, Elizabeth Beier of St. Martin’s Press, spoke with Daniels on the phone, and realized Daniels wasn’t confused – she really hadn’t received her third payment, even though the publisher had sent it to Avenatti long ago.
According to testimony, Avenatti also took Daniels’ second payment – $148,750 – but reimbursed her five weeks later with a loan from celebrity attorney Mark Geragos. That’s according to testimony from Glendale lawyer Sean Macias, a colorful character who captivated the courtroom from the witness stand with his emphatic denials that his house and office has ever been raided by the feds, and his wistful, protective affection for a client Avenatti asked him about in cross-examination, Spice Girl Mel B.
But the Geragos loan was the central part of Macias’ testimony, and it helped prosecutors establish a pattern with Avenatti that culminated with his outright theft of Daniels’ third payment, also $148,750, which she testified she’s still never received.
Aveantti tried to refute Macias’ testimony by showing jurors a text message Macias sent him before the Geragos loan that said Macias would get Avenatti some “do-re-mi” so he could “run like a banshee” for U.S. president. Prosecutors tried to keep it out of evidence, but Furman said while allowing it, “Certainly there’s a valid argument that do-re-mi is a reference to dough, which is a reference to money.”
Jurors never considered an actual dollar figure in their deliberations. But prosecutors told Furman in court that the figure at issue in the case is third payment of $148,750, not the second. That will matter a great deal at sentencing, which is currently scheduled for May 24 in Manhattan, because wire fraud sentences are tied to the amount of money involved in the crime. Wire fraud carries a maximum sentence of 20 years, but under federal sentencing guidelines, Avenatti faces about 24 to 30 months for the $148,750, including more time because he was in a position of trust. Then aggravated identity theft carries two years that must be served consecutively, so together, he’s looking at about four years in prison. And that’s on top of the 30 months he’s already to serve in the Nike extortion case.
But right now, the time Avenatti is serving isn’t counting toward any prison sentence. It’s pre-sentence detainment he agreed to with New York prosecutors to avoid being locked up immediately following the jury verdict last Friday.
On Monday, he filed a request with the trial judge in his California case, U.S. District Judge James Selna, asking to be housed at the jail in Santa Ana rather than the Metropolitan Detention Center in downtown Los Angeles, so he can be closer to his standby counsel as he prepares for his retrial. (Oral argument in his 9th Circuit appeal is scheduled for March 10 in Pasadena; it will be live streamed online.)
“Housing me at the MDC will make this process practically impossible and substantially interfere with my ability to mount a defense in this case,” Avenatti wrote, citing the location of his standby counsels’ offices in Orange County. But Selna declined early Tuesday because Avenatti is in custody per Furman’s case, not his. That means Avenatti likely will stay housed at the federally controlled MDC, rather than the Orange County sheriff-controlled Santa Ana jail until there’s a hearing in Selna’s case.
To give Selna jurisdiction over his placement, Avenatti could ask the judge to rescind the COVID-related home confinement order that’s been in place since April 2020. Avenatti also can ask Furman to order him placed in Santa Ana, but Furman is unfamiliar with California jail facilities, and he also made it clear during trial he was appalled by Avenatti’s crimes and not impressed by his defense tactics.
Avenatti moved to represent himself pro se midway through the prosecution;’s questioning of its second witness, his ex-paralegal, Judy Regnier, who testified via video from Arizona. Regnier worked for Avenatti up until federal agents raided her home on a cul-de-sac in Yorba Linda the day of Avenatti’s arrest in New York in March 2019. She’s been a key figure in each of the three prosecutions, testifying in the Nike trial as well as the California client fraud trial last summer.
Furman closely policed Avenatti’s work from there on out, sometimes cutting him off mid question by saying “sustained,” even though prosecutors had not yet made an objection for the judge to sustain.
A 2011 President Obama appointee whose brother, Jason, was Obama’s economic adviser, Furman also repeatedly hammered Avenatti outside the jury when discussing legal issues with the attorneys, at one point telling him: “Mr. Avenatti, you have a tendency to just lump 20 things together in one effort to throw spaghetti at the wall and see what sticks.” He also later told him, “Sometimes when you have no legal defense, you have no legal defense” regarding Avenatti’s argument that he had a good faith belief he was entitled to Daniels’ book money and thus is not guilty of a crime. Furman said the good-faith defense doesn’t account for Avenatti lying to Daniels after he took the money.
“You were not entitled to take this money without telling Ms. Daniels,” Furman said.
The judge also spoke of the need to “police” Avenatti’s closing argument so that he didn’t essentially testify without subjecting himself to cross examination.
“You’re not going to confuse me, and Mr. Avenatti, I am going to do everything in my power to make sure you don’t confuse the jury,” Furman said.
Avenatti had said during trial he was strongly considering testifying, but he opted not to after prosecutors detailed their plans to question him about his Nike extortion convictions and the client fraud allegations in California. He didn’t end up calling a single witness in his case.
Furman pressed jurors to keep deliberating after they announced a deadlock after 4 1/2 hours of deliberation over two days, then re-read them an instruction on Aveantti’s good-faith defense but rejected prosecutors’ later request for clarification. The jury later asked for help with a single holdout who a note said refused to deliberate and “does not understand the job of this jury,” and Furman instructed them to keep deliberating, rejecting Avenatti’s call for a mistrial. The verdict form shows the jury checked then crossed out the “not guilty” boxes.
Avenatti said after the verdict he’d immediately begin working on his appeal.
“I’m very disappointed in the jury’s verdict. I am looking forward to a full adjudication of all the issues on appeal,” he told reporters.
Daniels’ new lawyer, Clark Brewster, said Daniels “is relieved this nightmare is over.”
“The forgery of her name and his concealed directive to wire the money to him was irrefutable. Still, Mr Avenatti possessed the uncanny ability to steadfastly deny the crimes and persuade others he was entitled to the embezzled funds,” Brewster said. “Stormy is pleased that the justice system worked.”
Meghann M. Cuniff is a legal affairs journalist in California who attended Avenatti’s recent trial in New York City. She’s on Twitter @meghanncuniff.
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