Stormy Daniels’ Lawyer Hit With $10M Judgement For Old Firm’s Bankruptcy Case

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Adult film star Stormy Daniels’ lawyer, Michael Avenatti, will have to pay a former colleague $10 million, a federal bankruptcy court judge in California ruled Tuesday.

According to Bloomberg, the judge, sitting in Santa Anna, California, granted a motion for judgment against Avenatti’s old law firm, Egan Avenatti LLP, which had been in Chapter 11 bankruptcy proceedings.

The former class action firm started in 2007 and recently won a $454 million verdict last year against Kimberly-Clark Corp. and it’s subsidiary Halyard Health Inc. for unsafe surgical gowns, Bloomberg’s story said.

A judge eventually reduced the verdict to just around $25 million, according to Bloomberg.

As part of the proceedings, Jason Frank, a former colleague and creditor, and Avenatti reached a settlement for $4.9 million in December that was to end the case.

According to the article, Frank claimed he was owed millions in profits and fees from the firm and that Avenatti never made good on making the first $2 million payment of the December settlement by May 14, allowing Frank to make the motion for the $10 million default judgment.

Avenatti, who has been thrust into the public eye in the last several months for representing adult film star Stephanie Clifford, also known as Stormy Daniels, and her claim that she slept with President Donald Trump back in 2006, a decade before the real estate tycoon won the presidency, according to a timeline of the story in Glamour magazine.

One of President Trump’s personal attorneys, Michael Cohen, reportedly paid Clifford $130,000 in 2016 to keep her quiet about the alleged affair, according to Bloomberg.

Federal officers raided Cohen’s Manhattan office and seized boxes of documents in April, according to CNN.

According to CNN, Cohen’s business practices have been under federal investigation and that investigation led to a judge signing off on the raid.

Avenatti, the Bloomberg article said, is trying to join a lawsuit to get access to those documents that could show where exactly the $130,000 to pay Clifford came from.

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If the money came from the campaign, Trump could face Federal Election Commission violations, according to published reports.

NEW YORK, NY - APRIL 13: Michael Avenatti, attorney for Stormy Daniels, speaks to reporters following a court proceeding regarding the search warrants served on President Donald Trump's longtime personal attorney Michael Cohen, at the United States District Court Southern District of New York, April 13, 2018 in New York City. Cohen and his lawyers are asking the court to block Justice Department officials from reading documents and materials related to his relationship with President Donald Trump that they believe should be protected by attorney-client privilege. Officials with the FBI, armed with a search warrant, raided Cohen's office and two private residences earlier in the week.
Featured image credit: Drew AngererGetty Images

Since closing his old firm, Avenatti is now running Avenatti & Associates APC out of Newport Beach, California, Bloomberg reports.

He cannot appeal Tuesday’s $10 million default judgment, the Bloomberg article said.

Avenatti dismissed the latest ruling against him in bankruptcy court, calling it “completely irrelevant” to Clifford’s current suit with Trump and the involvement with the Cohen investigation, Bloomberg reported.

“[It] has nothing to do with the case,” Avenatti said in the Bloomberg article. “Who cares?”