Michael Avenatti Accused in Nike Extortion Attempt


Nicola T. Hanna, the United States Attorney in Los Angeles, said the two cases are unrelated, but the authorities in California and New York coordinated to arrest Avenatti and execute search warrants at the same time.

In the Nike case, the federal prosecutors said Mr. Avenatti represented a coach whose team recently did not have its contract with Nike renewed, according to the court documents. Mr. Avenatti told Nike that he had evidence that at least three former high school players were paid by Nike in ways that were intended to be concealed, the documents said.

Mr. Avenatti, according to prosecutors, threatened that he would hold a news conference at a moment when it could maximally disrupt Nike: before its quarterly earnings call last week, which also coincided with start of the N.C.A.A. men’s basketball tournament. The tournament is among the biggest annual events on the sports calendar, featuring many prominent teams, like Duke, North Carolina and Kentucky, who are sponsored by Nike.

Mr. Avenatti said he would refrain from publicizing his evidence if Nike paid $1.5 million to his client, who is not named, the court documents said. He also demanded that Nike hire him and another lawyer to conduct an internal investigation, for billings worth between $15 million and $25 million, court documents said.

As an alternative, prosecutors said, Mr. Avenatti said he would accept $22.5 million from Nike for him and his client in exchange for their not releasing the evidence.

According to the complaint, Avenatti told Nike that his client’s information, if publicized, would ultimately lower the value of Nike stock by billions of dollars. He believed that once he went public, parents, coaches and players all across the country would reach out to him with information about payments that violated N.C.A.A. rules.

“The company will die — not die, but they are going to incur cut after cut after cut after cut, and that’s what’s going to happen as soon as this thing becomes public,” Avenatti said in a meeting with Nike lawyers that was video and audio recorded.



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