Attorney Michael Avenatti researched items related to insider trading before allegedly attempting to extort Nike for $25 million, according to court documents.
Avenatti searched about insider trading on March 10, 2019 after taking the case of basketball coach Gary Franklin, who accused the sports apparel company of hiding illegal payments to basketball recruits, Fox Business reported Monday, citing court documents. The lawyer also closely monitored Nike’s stock prices, the Jan. 24 court filing shows.
He also searched online for “nike put options,” the court papers show. Put options allow an investor to sell when a stock price plummets. Nike is denying wrongdoing in the matter.
Federal prosecutors in New York argued that Avenatti employed a scheme “to extract more than $20 million in payments from a publicly traded company by threatening to use his ability to garner publicity to inflict substantial financial and reputational harm on the company if his demands were not met,” according to a criminal complaint in March 2019.
Avenatti is not charged with insider trading. (RELATED: Michael Avenatti Arrested Again While At California State Bar Hearing For Another Legal Matter)
The searches are “irrelevant” to the case, Avenatti attorney Scott Srebnick said in court papers.
“The obvious implication is that Mr. Avenatti illegally traded in Nike stock based upon information obtained by Coach Franklin,” he wrote. “That did not happen, the government has no evidence that it did, and Mr. Avenatti is not charged with insider trading.”
Avenatti is currently facing decades in prison for allegedly extorting the multi-million company. Authorities arrested him on Jan. 14 in California during a hearing related to another criminal allegation. Federal agents arrested him during a break in the hearing for violating the terms set for his pre-trial release.
Avenatti was the former attorney for porn star Stormy Daniels, who sued President Donald Trump so she could discuss aspects of her alleged sexual encounters with the president. Daniels received $130,000 in exchange for keeping quiet about the alleged encounter. Avenatti became a folk hero among some of Trump’s biggest detractors after his work with Daniels.
Prosecutors in the Nike case are trying to prevent Avenatti from using Trump’s name to politicize the trial.
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