Disgraced former Stormy Daniels lawyer Michael Avenatti embezzled his client's cash and spent it on a private jet, a new lawsuit claims.
The attorney is accused of taking a chunk of a $3 million settlement from NBA player Hassan Whiteside that was meant for Avenatti's client, the baller's ex Alexis Gardner, and spending most of it on a 2016 Honda Jet.
Legal documents filed in Los Angeles on Friday by the aircraft's insurer, Starr Aviation, claim the lawyer, who used to represent porn star Stormy Daniels in her case against Donald Trump, 'embezzled approximately $2,500,000' from the NBA player's former girlfriend 'to purchase the Aircraft'.
Disgraced former Stormy Daniels lawyer Michael Avenatti embezzled his client's cash and spent it on a private jet, a new lawsuit claims
The attorney is accused of taking a $3 million settlement from NBA player Hassan Whiteside (right) that was meant for Avenatti's client, the baller's ex Alexis Gardner (left), and spending most of it on a 2016 Honda Jet
Starr Aviation's legal complaint claims Avenatti bought insurance for his private jet (file photo of a 2016 Honda Jet) from them beginning January 2017 and renewed it for the next three years until January 2020
Avenatti was indicted in April for the alleged crime, as well as embezzling millions of dollars from other clients and committing tax and bankruptcy fraud, but denies any wrongdoing, saying he will fight the case against federal prosecutors.
If convicted of the 36 counts, the 48-year-old could face a maximum of 382 years in prison.
Starr Aviation's legal complaint claims Avenatti bought insurance for his private jet from them beginning January 2017 and renewed it for the next three years until January 2020.
The insurance firm says Gardner, 27, is now attempting to get back some of the cash that was allegedly stolen.
'Alexis Gardner may claim some interest against proceeds that might come due under The Policies,' the documents state.
'Starr Aviation would not have issued the policies if it had known the aircraft had been purchased with embezzled funds or the funds used to purchase the policies had been acquired through a bankruptcy fraud.'
Gardner hired Avenatti in a legal dispute with her ex, which ended in Whiteside agreeing to pay a $3 million settlement.
The former Miami Heat NBA player paid the first installment of $2.75 million in 2017, with the remaining $250,000 scheduled for November 2020.
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The former lawyer for Stormy Daniels was indicted in April for the alleged crime, as well as embezzling millions of dollars from other clients and committing tax and bankruptcy fraud, but denies any wrongdoing, saying he will fight the case against federal prosecutors. If convicted of the 36 counts, the 48-year-old could face a maximum of 382 years in prison
Avenatti was entitled to $1 million in fees according to prosecutors, but took $2.5 million and used a colleague's bank account to buy a share of the Honda Jet through his holding company, Passport 420 LLC.
The colleague, his former law firm partner Filippo Marchino, says he didn't know where the money came from and is outraged at the alleged embezzlement.
Marchino is now representing Garnder, who is trying to claw back the money she is owed from Avenatti.
Marchino's counsel, David Gammill, said: 'My clients will continue to assist in any investigation of Mr. Avenatti's fraudulent schemes and actively assist their clients in any way they can. 'Mr. Marchino and The The X-Law Group continue to represent Ms. Gardner in the pursuit of her stolen money. They look forward to justice being done and hope all victims of Avenatti, including themselves, can be made whole.'
Prosecutors say Avenatti kept Gardner in the dark about her payout, telling her Whiteside would be paying her in 96 monthly installments over eight years, and placating her with 11 payments over the next year totaling $194,000 – just 6 percent of her real settlement.
Gardner and Whiteside released a statement to the LA Times earlier this year after news of the indictment broke, regretting the spotlight that Avenatti's alleged fraud has shone on their failed relationship.
Prosecutors say Avenatti kept Gardner (pictured) in the dark about her payout, telling her Whiteside would be paying her in 96 monthly installments over eight years, and placating her with 11 payments over the next year totaling $194,000
'We entered into a mutually agreed upon settlement more than two years ago following the end of our relationship; a settlement that reflected Alexis' investment of time and support over a number of years as Hassan pursued a career in the NBA.
'It is unfortunate that something that was meant to be kept private between us is now being publicly reported. We have both moved on amicably and wish nothing but the best for each other.'
Whiteside became one of the NBA's highest paid players after joining the Miami Heat in 2014.
Though details of his settlement with Gardner remain secret, the settlement was intended to reflect her 'investment of time and support over a number of years' during his NBA career.
Avenatti has repeatedly protested his innocence, releasing a statement saying that 'no monies were ever embezzled from anyone and I look forward to all of the relevant documents and facts being presented at trial.'
Among the 36 counts in the federal indictment against the disgraced attorney are claims that he siphoned off his paraplegic client's $4 million injury compensation, leaving the man struggling to pay his bills.
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