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https://www.zerohedge.com/news/2019...enatti-warns-major-college-basketball-scandal
The SDNY has laid out its allegations of extortion against Avenatti - namely, that he tried to extort Nike - during an afternoon press conference.
After claiming to be working on behalf of an amateur basketball team in the AAU that had recently lost a Nike contract worth some $70,000 a year, Avenatti used "illegal and extortionate threats" to try and secure millions of dollars for himself from Nike. The coach from the team told Avenatti that payments had been made by Nike to high school basketball players. Avenatti threatened to make these allegations public if the company didn't meet his demands - paying his client $1.5 million, while awarding Avenatti and a co-conspirator a multi-million dollar contract to conduct an internal investigation.
Avenatti chose the timing of his plot very carefully, approaching Nike shortly before the company was set to report its Q1 earnings, and not to mention March Madness. At one point, he threatened to take $10 billion of Nike market cap.
Lawyers for Nike contacted federal prosecutors and reported the extortion attempt after they were initially contacted by Avenatti. Prosecutors suggested recording the next call with Avenatti - a recording which produced some choice quotations from the infamous "Creepy porn lawyer."
"I'm not f---ing around with this, and I'm not continuing to play games," Avenatti was recorded as saying. "You guys know enough now to know you've got a serious problem. And it's worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn't move the needle for me. I'm just being really frank with you."
"I'll go and I'll go take $10 billion off your client's market cap. But I'm not f---ing around," he said.
When the company's lawyers balked, he said it could skip the investigation if it simply paid him $22 million.
The whole incident - which SDNY described as an "old fashioned shake down" - unfolded over a period of three days, beginning earlier this month. Avenatti was arrested in Manhattan earlier on Monday and brought to the FBI offices.
As one reporter pointed out, the funniest part of the NY Avenatti indictment is the seemingly obvious (for everyone but Avenatti) setup engineered by Nike's lawyers.
Update 1: Just minutes after lawyer Michael Avenatti tweeted his tease of a press conference tomorrow claiming Nike is involved in a college basketball scandal, Bloomberg reports that Avenatti was just charged by federal prosecutors in New York with attempting to extort millions of dollars out of Nike Inc. by threatening to release damaging information about the company, which did not meet his demands.
Avenatti is alleged to have told Nike that he would cancel a press conference critical of sports apparel company only if it paid an unidentified client $1.5 million, and hired him and another California lawyer to conduct an internal investigation for $15 million to $25 million.
Avenatti is accused of wire fraud and bank fraud. He was arrested Monday, prosecutors said.
CNN's Erica Orden tweeted the details:
" SDNY is charging Michael Avenatti for "attempting to extract more than $20M in payments from a publicly traded company by threatening to use his ability to garner publicity to inflict substantial financial & reputational harm on the company if his demands were not met.""
According to the complaint filed in federal court, Avenatti told Nike attorneys by phone last week if his demands were not met, "I'll go take ten billion dollars off your client's market cap ... I'm not f*cking around."
"I'm not fucking around with this, and I'm not continuing to play games. . . . You guys know enough now to know you've got a serious problem. And it's worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn't move the needle for me. I'm just being really frank with you. So if that's what, if that's what's being contemplated, then let's just say it was good to meet you, and we're done. And I'll proceed with my press conference tomorrow . . . .
I'm not fucking around with this thing anymore. So if you guys think that you know, we're gonna negotiate a million five, and you're gonna hire us to do an internal investigation, but it's gonna be capped at 3 or 5 or 7 million dollars, like let's just be done. And I'll go and I'll go take ten billion dollars off your client's market cap. But I'm not fucking around."
And Nike shares are rebounding...
SDNY is having a press conference on the Avenatti charges at 2:30pm.
The SDNY has laid out its allegations of extortion against Avenatti - namely, that he tried to extort Nike - during an afternoon press conference.
After claiming to be working on behalf of an amateur basketball team in the AAU that had recently lost a Nike contract worth some $70,000 a year, Avenatti used "illegal and extortionate threats" to try and secure millions of dollars for himself from Nike. The coach from the team told Avenatti that payments had been made by Nike to high school basketball players. Avenatti threatened to make these allegations public if the company didn't meet his demands - paying his client $1.5 million, while awarding Avenatti and a co-conspirator a multi-million dollar contract to conduct an internal investigation.
Avenatti chose the timing of his plot very carefully, approaching Nike shortly before the company was set to report its Q1 earnings, and not to mention March Madness. At one point, he threatened to take $10 billion of Nike market cap.
Lawyers for Nike contacted federal prosecutors and reported the extortion attempt after they were initially contacted by Avenatti. Prosecutors suggested recording the next call with Avenatti - a recording which produced some choice quotations from the infamous "Creepy porn lawyer."
"I'm not f---ing around with this, and I'm not continuing to play games," Avenatti was recorded as saying. "You guys know enough now to know you've got a serious problem. And it's worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn't move the needle for me. I'm just being really frank with you."
"I'll go and I'll go take $10 billion off your client's market cap. But I'm not f---ing around," he said.
When the company's lawyers balked, he said it could skip the investigation if it simply paid him $22 million.
The whole incident - which SDNY described as an "old fashioned shake down" - unfolded over a period of three days, beginning earlier this month. Avenatti was arrested in Manhattan earlier on Monday and brought to the FBI offices.
As one reporter pointed out, the funniest part of the NY Avenatti indictment is the seemingly obvious (for everyone but Avenatti) setup engineered by Nike's lawyers.
Update 1: Just minutes after lawyer Michael Avenatti tweeted his tease of a press conference tomorrow claiming Nike is involved in a college basketball scandal, Bloomberg reports that Avenatti was just charged by federal prosecutors in New York with attempting to extort millions of dollars out of Nike Inc. by threatening to release damaging information about the company, which did not meet his demands.
Avenatti is alleged to have told Nike that he would cancel a press conference critical of sports apparel company only if it paid an unidentified client $1.5 million, and hired him and another California lawyer to conduct an internal investigation for $15 million to $25 million.
Avenatti is accused of wire fraud and bank fraud. He was arrested Monday, prosecutors said.
CNN's Erica Orden tweeted the details:
" SDNY is charging Michael Avenatti for "attempting to extract more than $20M in payments from a publicly traded company by threatening to use his ability to garner publicity to inflict substantial financial & reputational harm on the company if his demands were not met.""
According to the complaint filed in federal court, Avenatti told Nike attorneys by phone last week if his demands were not met, "I'll go take ten billion dollars off your client's market cap ... I'm not f*cking around."
"I'm not fucking around with this, and I'm not continuing to play games. . . . You guys know enough now to know you've got a serious problem. And it's worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn't move the needle for me. I'm just being really frank with you. So if that's what, if that's what's being contemplated, then let's just say it was good to meet you, and we're done. And I'll proceed with my press conference tomorrow . . . .
I'm not fucking around with this thing anymore. So if you guys think that you know, we're gonna negotiate a million five, and you're gonna hire us to do an internal investigation, but it's gonna be capped at 3 or 5 or 7 million dollars, like let's just be done. And I'll go and I'll go take ten billion dollars off your client's market cap. But I'm not fucking around."
And Nike shares are rebounding...
SDNY is having a press conference on the Avenatti charges at 2:30pm.
