6:50am PT by Eriq Gardner
Is Stormy Daniels Getting Her Money's Worth From Attorney Michael Avenatti?
At THR's annual New York party on April 12, by far the most popular media star was Michael Avenatti, the fast-talking 47-year-old lawyer who has become — together with his client, adult film actress Stormy Daniels — a household name. In a room packed with anchors and cable news hosts, Avenatti was swamped by admirers expressing the same sentiment: "Thank you for your service to the country."
But just how much service is Avenatti providing his client? For all his constant TV appearances and expert trolling of the president on social media, is he really mounting the best possible legal case for Daniels? He's turned a skirmish with Trump over an iffy hush agreement about a decade-ago affair into a high-stakes political battle with the White House. And most observers assume the more Daniels is in the headlines, the more Avenatti is succeeding. "If both of their interests are to maximize publicity in order to enhance future income, then he's doing an excellent job," notes entertainment litigator Howard King.
But many lawyers believe Avenatti's strategy is risky. His argument — Trump didn't sign the contract with the nondisclosure agreement, so it isn't valid — isn't terrible, but it's no slam dunk. After all, Daniels did accept $130,000 for her silence and hasn't returned any of it. But if Avenatti ends up losing, the cost to Daniels could be ruinous. One court document suggested the damages might reach $20 million, and that was based on the first leg of the media tour. It could be higher now.
Avenatti's media ubiquity is something few lawyers would recommend. Indeed, in the early days of the case, a federal judge took a not-too-subtle dig at Avenatti, declaring that the Daniels suit was "not the most important matter on the court's docket." That same judge later ruled against Avenatti by delaying Daniels' case after the office of Trump's onetime personal lawyer Michael Cohen was raided by federal agents, allowing Cohen's potential future criminal trial — with its Fifth Amendment complications — to slow Avenatti's civil proceedings.
Avenatti, though, makes no apologies for his tactics. He believes his daily (sometimes hourly) CNN and MSNBC appearances ultimately will win the day. "You can argue with me about a lot of things," he tells THR, "but you can't argue that the media strategy hasn't worked. We're crushing it on the PR front. The strategy has elevated my client's stature — she's revered now across many demographic groups. It's elevated the importance of her lawsuit. And it's resulted in damaging information being provided to us by members of the public who have heard about the case through the media strategy."
Avenatti has been successful in highlighting the murky nature of that $130,000 payment, but it's not clear he's advanced his stated goal to invalidate her contract. He hasn't won any significant point in court, and he can't truly take credit for the actions of New York prosecutors investigating Cohen. If the real strategy is to embarrass Trump and Cohen enough that they'll let her out of the hush deal, he hasn't achieved that yet either.
On the other hand, nobody has been helping Avenatti's cause more than Trump himself. The fact that the president has not been able to keep his story straight about the Daniels payment — first he didn't know about it, then he did — has provided immeasurable assistance to Avenatti's PR push. If Avenatti did indeed plan to nudge Trump into a minefield of potential campaign finance violations and bank fraud laws, then Trump fell into his trap. Every revelation in this story, legally relevant or otherwise, gets treated as momentous by reporters, whose thirst for Trump scandal has hardly been quenched by the drip drip drip Robert Mueller investigation. The president simply could have let Daniels tell her story (as she's been doing anyway), the case would have been rejected without anything justiciable, and the Stormy headlines would have fizzled out after a couple of news cycles. An old affair with a porn star would today be the least of the president's troubles.
But that hasn't happened, as Trump is nothing if not stubborn and litigious. He and Cohen could play this whole case out, enduring the negative press and intrigue with an eye on winning the ultimate case and potentially sticking Daniels with a massive judgment that would generate its own headlines.
And even as he takes risks for his client, Avenatti seems to be positioning himself for a bright future. Vanity Fair reported that he approached MSNBC president Phil Griffin about getting his own show, although Avenatti later claimed it was the other way around — networks approached him. Regardless, Avenatti's profile-boosting posturing certainly will be a win for him. "This ceased being about 'the law' and 'her rights' about three seconds after they filed the lawsuit," says Robert Schwartz, a litigation partner at Irell & Manella. "There is no meaningful downside. The coverage will drive business to him for years."
Rudy Giuliani, who (for the time being) has the gig of Trump's personal lawyer, has been calling Avenatti an "ambulance chaser," even as Giuliani has copied Avenatti's tactics by going on TV at every opportunity (although with considerably less flair; Trump is rumored to be already vexed with his new attorney for numerous on-air blunders). A more accurate assessment, though, is that Avenatti is another Gloria Allred, litigating in the press (or, in this case, on cable news) and seizing a platform for himself in a nonstop media age that demands constant punditry. For now, Avenatti is advocating for Stormy Daniels, but it's not hard to see The Avenatti Show expanding to other clients and causes for future seasons — er, cases. To corner this business, the depth of his legal acumen or the wisdom of his strategy hardly matter. Avenatti can keep boasting that he's winning, and these days, with this president, that seems to be all that's necessary.
THEN AGAIN, UPON FURTHER THOUGHT, is Avenatti too thin-skinned to survive in the limelight past his Stormy Daniels moment?
As I was preparing this column, Avenatti learned that The Hollywood Reporter would be tallying his media appearances and reached out to an editor to express concern. Avenatti indicated he'd be open to questions so I sent him a half-dozen. Speculating that the result of my assessment of his work wouldn't exactly be flattering, he called me up and became somewhat menacing. At one point, he called me an "asshole" with an agenda and accused the lawyers I had spoken to of being jealous of his success. This conversation occurred before he threatened to sue a reporter at The Daily Caller over what he perceived to be "hit pieces."
Certainly, Avenatti has confronted attacks on his motives from those who might lean to the right and don't appreciate what he's up to. Everything from an association with Rahm Emanuel back in his college days to questions about who is really paying him has been used in an attempt to tar him. (Avenatti insists his bills are being paid by Daniels, real name Stephanie Clifford, or by crowdfunded donations, and any suggestion he's backed by a left-wing PAC is "utter bullshit.")
But I was really interested in some of the legal dynamics at play.
For instance, I asked him to explain why his client hasn't returned the payment if she believes the agreement is invalid. That's something that often happens when someone is attempting to refute the existence of a deal. Without really answering the question, he responded, "Please see the proposed settlement we made months ago. Did you read it?"
I also wanted to know how the release of Cohen's bank information advanced his core argument that the disputed agreement should be invalidated. And I gave him a chance to pat himself on the back by asking whether other lawyers — including those representing #MeToo victims under nondisclosure agreements — could learn anything from the strategy he was employing in the Stormy Daniels case. "I hope so," he said curtly to the latter query. "We shall see."
There were certainly tough questions that I can understand rubbed him the wrong way. For instance, given that the American Bar Association and the State Bar of California, in their rules of professional conduct, caution attorneys against any extrajudicial statement that will have a substantial likelihood of prejudicing a proceeding, and not all judges appreciate lawyers discussing cases in the media, why do the rewards of being so out there outweigh the risks? "We have done nothing improper," he answered. "If speaking the truth subjects us to risk, so be it."
Or take a query related to the defamation lawsuit he brought against Trump. Some legal observers have pointed out that Daniels hails from Texas, which could mean that Trump may attempt to kill the lawsuit at an early stage based on Texas' anti-SLAPP statute. (Trump attempted the same thing in the Summer Zervos defamation case by looking to use California's anti-SLAPP statute in New York court.) If successful (and there's good reason to believe Avenatti will have a hard time showing Trump's "con job" comment is a statement that's factually disprovable and rises to actual malice), that might entitle Trump to recover legal fees. Could he guarantee that those donating to the Stormy Daniels cause wouldn't see any of their contributions in Trump's pocket? He didn't answer.
Maybe the question that really set him off, though, was: What legal developments in the Stormy Daniels case gave him confidence that the outcome would be favorable? As mentioned, he hasn't won a significant motion in court. Judges tend to defer to arbitrators about the arbitrability of matters. And media appearances were being cited by the other side as a basis for substantial damages. In response, he accused me of not knowing my law — that Section 4 of the Federal Arbitration Act gave his client a right to a jury trial on the validity of the arbitration agreement. However, this is one of those chicken-or-egg, what-comes-first areas of law. While what he says is true, the judge might weigh whether there's any triable issues of fact before granting a trial, and in this case, Trump's side is attempting to downplay controversy, pointing to no dispute that she actually signed the hush deal, accepted payment, and spent 16 months without asserting any objection despite the absence of Trump's signature. The other side also posits that in order to get a trial, she has to be challenging the arbitration clause specifically, and not merely the validity of the contract as a whole.
Maybe not necessarily something that's going to kill his hopes of a trial, but legal nuances like these have been drowned out by hyperventilating coverage of Avenatti's revelations and rhetoric. In any event, it's all taken a back seat to what's happening now with Cohen — which Avenatti can't take full credit for, as much as he would love to, as Mueller has reportedly been investigating Cohen for many months.
In any event, Avenatti is getting great write-ups in general (e.g. Slate: "The Brilliant Egomaniac Who Could Bring Down Donald Trump"; Daily Beast: "Trump Has No Plan to Counterpunch Michael Avenatti"), but he seems to react rashly when challenged, which could turn into a weakness down the road.
As Nate Silver tweeted, "I'm sure I'm not the first person to observe this, but Avenatti seems quite Trumpian in both loving media attention and acting quite contemptuously toward the free press."
A version of this story first appeared in the May 16 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.