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Law360 (January 6, 2021, 6:54 PM EST ) The California federal judge overseeing Michael Avenatti's embezzlement case indicated Wednesday that the embattled attorney's trial will likely be pushed to July to allow him sufficient time to prepare for a spring trial in New York over accusations he stole proceeds from Stormy Daniels' book deal.
At a telephone hearing, U.S. District Judge James V. Selna asked Avenatti's attorney and federal prosecutors to meet and discuss moving the attorney's bifurcated trial from Feb. 23 to mid-July. Judge Selna said it "seems appropriate" to grant Avenatti's request to delay the proceeding after Avenatti pointed out the continuing risks of the coronavirus pandemic and arguing that he needs time to prepare for an April trial over his alleged theft of hundreds of thousands of dollars owed to his former client Daniels, a porn actress who said she had an affair with now-President Donald Trump back in 2006.
In a status report filed Tuesday ahead of the hearing, Avenatti said he will be working closely with his New York attorneys for the Daniels case, which has been complicated by the pandemic and Avenatti's home confinement, which restricts his access to technology.
Avenatti also said Daniels' case will likely attract a significant amount of publicity and media coverage, which would interfere with his due process rights in the California case if the two trials take place too close together.
To complicate matters further, Avenatti said his attorney H. Dean Steward has another unrelated case set for a two-week trial beginning June 1, which will require Steward to dedicate most of May to preparing for that case.
In the report, Avenatti urged Judge Selna to set the case for Aug. 24.
But at the hearing Wednesday, Judge Selna indicated he would like to set the trial for July and asked the parties to talk it over.
Following the hearing, Steward told Law360 that he and his client will be ready for trial in July. A representative for the government declined to comment.
Avenatti's first trial in California severs the 10 counts of wire fraud alleging he siphoned five clients' settlement awards from the remaining 25 counts of bank and tax fraud related to his various business operations. The second trial is currently set for Oct. 12, and Judge Selna said Wednesday that he'll keep that date as is for now.
Avenatti is on home confinement until March, according to the docket, after Judge Selna last month once again extended the attorney's freedom after several similar orders.
The government had argued that no more extensions should be made until Judge Selna rules on prosecutors' request to send Avenatti back to prison over "clear and convincing" evidence that he used a computer to draft court documents in violation of his release conditions.
The government raised concerns in June that Avenatti was accessing the internet through a computer owned by his bail-release custodian and longtime friend Jay Manheimer.
Avenatti slammed the bid to revoke his bond, saying the government was relying on "unreliable and inadmissible" data.
In the indictment against Avenatti announced in April 2019, prosecutors claim he defrauded five of his former clients by lying to them about the details of settlements in their favor while using the money for his own ends.
Prosecutors say Avenatti used millions of dollars in ill-gotten funds to pay bankruptcy creditors and other clients from whom he had taken money.
In addition, Avenatti was stiffing the government on payroll taxes from his Tully's Coffee business to the tune of $3.2 million between 2015 and 2017, according to the indictment. He is also charged with failing to file personal tax returns between 2014 and 2017 and failing to file returns for his law firms Eagan Avenatti LLP and Avenatti & Associates between 2015 and 2017.
Avenatti was found guilty last year of extorting Nike in a separate New York case. The attorney's sentencing was recently delayed until February because of a spike in COVID-19.
The government is represented by Julian L. Andre, Brett A. Sagel and Patrick R. Fitzgerald of the U.S. Attorney's Office for the Central District of California.
Avenatti is represented by H. Dean Steward.
The case is U.S. v. Michael Avenatti, case number 8:19-cr-00061, in the U.S. District Court for the Central District of California.
--Additional reporting by Andrew Strickler, Stewart Bishop, Reenat Sinay and Dave Simpson. Editing by Bruce Goldman.
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