On tap Monday in Orange County federal court: the four-way legal fight for Michael Avenatti's jet
The imprisoned ex-lawyer bought a jet with $2.5 million he stole from a client. Now that client is asking a judge for her share. Her competition includes the jet's co-owner.
The legal battle for disgraced ex-lawyer Michael Avenatti’s jet is scheduled for a hearing today in Santa Ana, California, with two ex-clients, the trustee for his bankrupt law firm and a former partner vying for control of the aircraft.
Avenatti won’t be in court: He’s imprisoned at the Federal Correctional Institution, Terminal Island in San Pedro, near Long Beach, for attempting to extort Nike and for defrauding clients in California and New York, including porn star Stormy Daniels in 2018 when he was representing her in lawsuits against President Donald Trump.
He agreed to forfeit the jet to the U.S. Department of Justice as part of his guilty plea in the California case, but Senior U.S. District Judge James Selna allowed for people claiming interest in the court to petition the court.
The first to do so was Jason Frank, Avenatti’s former law partner who is owed more than $15 million for a broken partnership agreement. Other petitions followed from Richard Marshack, the court-appointed trustee controlling Avenatti’s bankrupt law firm; William Parrish, the client who bought the jet with Avenatti; and Avenatti’s client-turned-victim Alexis Gardner, from whom Avenatti embezzled $1.5 million and used to pay for his portion of the jet.
All are expected to be in Selna’s courtroom in Santa Ana Monday.
Selna issued a tentative ruling that divides the jet this way: (Spring Creek is Parrish’s company.)
Seized in April 2019 in Santa Barbara County, Avenatti bought the the Honda HA-420 jet in 2017 for $4.3 million in partnership with Parrish. His California client theft case established that Avenatti paid for his portion with $2.5 million he stole from Gardner’s settlement with her ex-boyfriend, NBA player Hassan Whiteside.
Gardner is now represented by Avenatti’s former law partner, Filippo Marchino, who testified as a prosecution witness in Avenatti’s California trial but also is accused in separate proceedings in U.S. Bankruptcy Court of conspiring with Avenatti to hide assets. Marchino argues Gardner is due the entire $2.5 million, though he acknowledges the jet likely is worth less.
“On information and belief, the Aircraft has been maintained by the Government but has not been flown since it was seized in 2019. Hence, the value would be significantly less than a comparable model year Aircraft that was routinely flown, used and maintained,” Marchino wrote.
You can read Gardner’s filings here:
Frank, who worked with Avenatti from 2013 to 2016, is represented by another former Eagan Avenatti LLP partner, Andrew Stolper. Stolper and Frank currently work together at Frank Sims & Stolper LLP in Irvine. Stolper is a former assistant U.S. attorney who questioned him about apparent client embezzlement in public judgment debtor examinations before he was criminally indicted, one of which was attended by an Internal Revenue Service agent who was a lead investigator in the California case.
Here are Frank’s filings:
Parrish is represented by Larry Conlan of Cappello & Noël LLP. He and Avenatti have a tangled history: In 2011, Avenatti helped secure a $39 settlement for Parrish and his business partner, E. Timothy Fitzgibbons, then fell into a years-long battle over co-counsel Robert Stoll’s $5.4 million legal fee. Stoll took Parrish and Fitzgibbons to trial in Orange County Superior Court, accusing them of conspiring with Avenatti to stiff him out of his $5.4 million attorney fee. A jury sided with Parrish and Fitzgibbons in June 2022.
Parrish’s first petition for the jet said Avenatti victimized him “as much as or more than any other party claiming an interest in the jet,” and the money Parrish put toward the aircraft entitles him to at least a portion of its sale proceeds. The second brief argues Parrish can’t forfeit interest in the jet because he’s not a criminal defendant.
“The only criminal here is Michael Avenatti,” according to the brief.
You can read Parrish’s filings here:
The final aspiring jet owner is Marshack, the court-appointed trustee for Avenatti’s bankrupt law firm. Marshack is trying to recover assets for Avenatti’s firm and its long list of creditor, and he says Avenatti wrongly paid for some of the jet using firm money that should have gone to creditors. He wants the jet sold and Gardner to receive 54.25 of the proceeds and the firm to get 45.75 percent.
You can read Marshack’s filings here:
I’ll be covering the hearing live from Judge Selna’s courtroom beginning at 9 a.m. Look for a full article on Legal Affairs and Trials with Meghann Cuniff, and follow my updates on Twitter.
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