6:41am PT by Eriq Gardner
Is Michael Avenatti Any Worse Than Many Hollywood Lawyers?
Is the difference between a good plaintiff lawyer and a bad one the ability to commit extortion and get away with it?
On Monday, Michael Avenatti showed the world what it means to fail miserably at his job. After tweeting his intention to hold a press conference "to disclose a major high school/college basketball scandal perpetrated by @Nike," he was promptly arrested and charged with threatening to terrorize the shoe company with harmful revelations unless he was paid $20 million.
Most observers have viewed this prosecution through the prism of both the sports world as well as a controversial figure potentially getting his comeuppance. But what if Avenatti had been more subtle? What if, instead of foreshadowing allegations against Nike in a tweet seen by millions, he had opened talks with Nike but otherwise remained tight-lipped until actually going to court? And what if he never demanded that Nike pay him a handsome retainer fee to be in charge of an investigation? He could have merely told the company that the money would be going to his clients — and privately divvied up the rewards with them. Did he really need to ask a Nike lawyer whether the guy “had ever held the balls of the client in your hand where you could take five to six billion dollars market cap off of them?”
It's no surprise that Avenatti, of all lawyers, finds himself in this position. Besides being the type of brash guy who will call a reporter an "asshole" for asking tough questions, just two years ago he was accused of an attempt to extort Jim Carrey in a lawsuit over the suicide of the comedian's ex-girlfriend. That case was dropped in January 2018. Weeks later, Avenatti would become nationally known as the attorney representing Stormy Daniels in an attempt to invalidate a Donald Trump hush payment. There, he used nonstop appearances on cable news as his weapon of choice.
That Avenatti was essentially demanding a hush payment from Nike is no doubt ironic, but Avenatti is hardly the only lawyer in recent years to leverage wide access to the media to achieve goals.
Take Mark Geragos, who, according to several news reports, is the unindicted co-conspirator who assisted Avenatti in negotiations with Nike. Five years ago, Geragos was representing pop star Kesha in a bid to extradite her from a contract with producer Lukas "Dr. Luke" Gottwald. Before any lawsuit was filed, Geragos sent a draft complaint to Sony Music making it clear that if Kesha wasn't let out of her recording and publishing deals, she would accuse Dr. Luke of rape. The ploy didn't work. No settlement followed, and Dr. Luke would soon file a defamation lawsuit against Kesha over what was sent to Sony as well as statements put out in the media about the alleged sexual assault. That case is still ongoing.
For plaintiff-side lawyers, high-profile targets invite both opportunity and trouble.
An attorney like Gloria Allred can command a room full of reporters on a moment's notice with fresh allegations against the likes of Bill Cosby, Harvey Weinstein or R. Kelly. But over the years, she's been pretty careful in how she approaches targets. According to those familiar with her practice, she'll demand mediation with the prospect of litigation hanging out there. She doesn't need to explicitly threaten shame. The lawyers she's dealing with on the other side are sophisticated. They know the stakes. If negotiations fail, the press release then comes.
If the rule of the extortion racket is to wink to the prospect of running to the cops or the press but never voice that possibility — especially when one's adversary may be wearing a wire — what about the gray area of delivering a draft lawsuit to your opponent?
A few years ago, for instance, Hollywood attorney Marty Singer told VH1's Famous Food host Mike Malin that he had drafted a lawsuit that would be filed if Malin didn't return missing funds to a business restaurant partner. Singer's letter left blank spaces in the draft complaint, and Malin was told that those spaces would later be filled by allegations of sexual liaisons with older men.
The First Amendment protects an individual's right to petition, and in past cases, courts have held that pre-litigation settlement communications by attorneys are privileged. That's how Singer beat Malin's claim of extortion over the menacing letter.
It doesn't always work.
In Dr. Luke's defamation suit against Kesha, for instance, Geragos attempted to avoid a deposition with the argument that his communications with Sony constituted settlement discussions. Not only was Geragos unable to avoid testimony, but the fact that Kesha's reps leaked an advance copy of the complaint to TMZ has become quite an issue in the case. The issue of litigation privilege continues to be one of the most important ones at the summary judgment phase. And Geragos himself is facing a defamation claim from Dr. Luke for suggesting in a tweet that the producer raped Lady Gaga.
Now, thanks to his involvement with Avenatti, Geragos has gone from standing up for Kesha to having to hire Benjamin Brafman, the attorney who unsuccessfully tried to save Harvey Weinstein from life in prison.
Avenatti could attempt a defense premised on litigation privilege in a bid to beat charges that he attempted to extort Nike. He will likely frame his discussions with Nike as routine lawyering, the typical given-and-take by attorneys when attempting to arrive at a resolution that avoids a court drama. The challenge for Avenatti will be explaining away his tweet. Plus, the feds appear to have Avenatti on tape demanding more than just a payment to his client. (This is only the New York case, of course. Avenatti also faces charges in California for allegedly embezzling client money to pay personal expenses and debt.)
That Nike went to the feds to report an alleged extortion attempt is itself an interesting development. The company clearly made a decision to risk the type of scandal that put Adidas under the prosecutorial microscope. Does this show something? Maybe combined with how Jeff Bezos handled the potential publication of private photos in the midst of a negotiation by his attorneys, it demonstrates that sometimes, celebrities and corporations are well-advised to go on the offensive.
If so, plaintiffs' lawyers better watch out. Certainly, there will be many secrets that public figures will pay a price to keep mum. In such situations, those highly sensitive to scrutiny may ignore blatant instances of chargeable extortion. But for those rare times when authorities are called or defamation suits are filed, it helps to not behave like Michael Avenatti.