Michael Avenatti's law firm hit with $10 million bankruptcy judgement

[Miles Archer]

Michael Avenatti’s law firm hit with $10 million bankruptcy judgement



https://www.rawstory.com/2018/05/michael-avenattis-law-firm-hit-10-million-bankruptcy-judgement/

Stormy Daniels’ attorney Michael Avenatti has been hit with a multi-million dollar bankruptcy judgement — and he’s been accused of defaulting on back taxes as well.

The Los Angeles Times‘ Michael Finnegan tweeted Tuesday that Avenatti’s firm was been charged a $10 million judgement in U.S. Bankruptcy Court.

Michael Finnegan
?
@finneganLAT

Breaking: Avenatti law firm hit today with $10 million judgment in US Bankruptcy Court. Justice Dept lawyer says Avenatti also defaulted on back taxes he’d agreed to pay. Story ahead.

10:53 AM - 22 May 2018

Link to tweet

Finnegan reported last week that Avenatti was also late on a $2 million installment of a $4.85 million debt he owes to his former law partner, Jason Frank.

[manor321]

1. Avenatti responds to that tweet

Link to tweet

"Nonsense. Completely different law firm - no ties to Daniels case. Irrelevant. Over blown. Sensational reporting at its finest. Check the facts next time please and report accurately."

[Iliyah]

2. In another universe I would shake my head but we are not in another

universe, we are here in this reality and it appears like every gawd damn shit always paints the blame game from the ones who are dishonest and corrupt. In other words, everyone is dishonest and corrupt here in the USA.

Anywho, give t-rump, Cohen and the rest hell.

[saidsimplesimon]

3. I was so tempted

to praise his media blitz. Like most things in my life, it is best to hang out for the facts before jumping on the freight train of unknown destinations. On the other hand, I truly enjoyed his trolling of the clown in our WH.

[emulatorloo]

13. See post #1. It apparently isn't true n/t

[saidsimplesimon]

17. Thank you, emulator

The truth itself is difficult to discern when I feel like Alice going down a rabbit hole. You know, Orwellian double speak, "up is down"....

[brush]

85. It's expected. He's getting "Frankened" for going after trump. Bet Roger Stone...

has something to do with it.

[still_one]

114. Well said Brush

[PoliticAverse]

19. Where does Avenatti say it isn't true? He says it's "Irrevelant" and "Overblown".

He seems to be using a very Trump-like non-denial distraction.

[oasis]

99. Do you think maybe it could be a different law firm?

[PoliticAverse]

100. Well see...

https://www.democraticunderground.com/?com=view_post&forum=1002&pid=10645167

[still_one]

115. If some folks read his response you would kinda discern that

but there was some action

[oberliner]

25. No, it is true

[jberryhill]

30. It's not true because Avenatti says so?

Actually, he doesn't say that, and the hearing on the motion to enforce judgment was indeed scheduled for today:


U.S. Bankruptcy Court
Central District of California (Santa Ana)
Bankruptcy Petition #: 8:17-bk-11961-CB

Assigned to: Catherine E. Bauer
Chapter 11
Involuntary
Claims Register


Debtor
Eagan Avenatti LLP
520 Newport Center Dr #1400
Newport Beach, CA 92660
ORANGE-CA
Tax ID / EIN: 32-0210824

05/21/2018 439 Hearing Set (RE: related document(s)436 Generic Motion filed by Creditor Jason Frank Law, PLC) The Hearing date is set for 5/22/2018 at 10:00 AM at Crtrm 5D, 411 W Fourth St., Santa Ana, CA 92701. The case judge is Catherine E. Bauer (Firman, Karen) (Entered: 05/21/2018)

05/21/2018 440
(5 pgs) Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof Filed by Creditor Jason Frank Law, PLC (Attachments: # 1 Affidavit Declaration of Jason M. Frank in Support of (I) Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; and (II) Application for Order Setting Hearing on Motion on Shortened Notice # 2 Exhibit A - C to Declaration of Jason M. Frank # 3 Exhibit D - F to Declaration of Jason M. Frank)). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 441
(6 pgs) Declaration re: Telephonic Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 442
(12 pgs) Declaration re: Email Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 443
(4 pgs) Proof of service (Amended) re Application for Order Setting Hearing on Shortened Notice; Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; and Supporting Documents Filed by Creditor Jason Frank Law, PLC (RE: related document(s)435 Application shortening time re Order Setting Hearing on Shortened Notice, 436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

-------

I've bolded what seems to be Avenatti's point here. His firm, Eagan Avenatti LLP, has been embroiled in a dispute with a former partner for quite some time.

His new firm, as of a few months ago, is Avenatti Associates. That's why he's saying it's a "different firm".

[mac56]

34. You're enjoying this, aren't you?

[jberryhill]

39. Enjoying what?

I thought it would be helpful to provide information direct from the court's own docket, if there was any confusion about what was going on. Yes, there was a hearing today. The docket has not yet updated with any particular order from that hearing, but the LA Times is reporting that the judge ruled against Eagan Avenatti.

Avenatti's tweet states that it is a "different" law firm. That is correct. Avenatti's tweet does not claim that the story is "untrue". His current firm is Avenatti Associates. His former firm is Eagan Avenatti.

Excuse me for actually doing some research to determine on what the LA Times article is about, but the truth does matter. Always.

[uponit7771]

40. Avenatti is saying "Completely different law firm", ... time to wait

[jberryhill]

42. It's Eagan Avenatti LLP

That is the firm of which he was a principal prior to his more recent formation of Avenatti Associates.

You can look at the court docket and parties yourself:

https://www.courtlistener.com/docket/6151942/eagan-avenatti-llp/

Avenatti Associates is his current firm, since Egan Avenatti has been tied up in this proceeding since March 2017.

[uponit7771]

48. It's not the law firm he heads now so why is this relevant to anything? Sounds like a ...

... business that went bust, that happens.

He's in a dispute about something, why is this noteworth?!

Thx in advance

[jberryhill]

54. Why is it noteworthy?

I have no idea. I didn't post the OP.

This dispute had been going on for a long time over fees his former partner claimed that Avenatti owed him. It is not the law firm he heads now for the obvious reason that he formed a new one when this one went into involuntary bankruptcy. Quite obviously, you don't throw more money in the kitty when there is a dispute over it.

Some people seem to have some sort of odd emotional hangup over the fact that, yes, Avenatti is involved in a number of disputes over his former law firm and his former dealings involving Tully's Coffee. I have no idea why anyone gets their knickers in a twist over them either way.

But, having access to a PACER account, I figured I'd check the docket since there seems to have been a dispute - i.e. this thread - about what was going on in this proceeding.

You're welcome.

[sarah FAILIN]

109. Thank you

You always have good explanations for those of us not in your field.

[Hassin Bin Sober]

44. Enjoying the truth? I hope so.

JBerryhill is an attorney has done a great job of cutting through the bullshit regarding this case.

I like Avenatti a lot but the guy is no saint. This still doesn’t take away from all the trouble he and Daniels have caused for Cohen and Trump.

The fact his prior firm was bankrupt is no secret. The story has been out there.

[emulatorloo]

46. I stand corrected. I misinterpreted Avenatti's tweet.

“It's not true because Avenatti says so?” No. I misread and misinterpreted the tweet.

[PoliticAverse]

4. I can see now why this guy seems to understand Trump. n/t

[angrychair]

8. It's not real, it's spam

See post above...this IS NOT a legitimate story

[PoliticAverse]

21. If you are gonna use Trumpian deflection tactics you need to call it "fake news". n/t

[LanternWaste]

24. It's rather inspiring to us that you pretend A is no different than B.

It's rather inspiring to us that you pretend A is no different than B.

Well, maybe the inspiration would come had you presented objective evidence to support your allegation, but that's far too inconvenient to a wounded bias.

Should you choose to call your unsupported allegation something other than what it is, "fake news" (as you alluded to) is already taken.


Good luck!

[angrychair]

65. Not what I said

Im basing my contention on the actual evidence we have. The law firm is not his current business. This is about a business, not him personally. This is an old, on-going case about a former business. He already spoke out and challenged the story as being inaccurate.

Not sure why you are coming down so hard against him about it. He has produced a lot of solid evidence against Cohen and trump.

[jberryhill]

81. Just for clarity

It is about his current business and him personally, since his current firm, and he personally, guaranteed payment. That's why they are identified in the actual settlement stipulation which was determined to have been breached:

https://www.courtlistener.com/recap/gov.uscourts.cacb.1788714/gov.uscourts.cacb.1788714.436.2.pdf

[angrychair]

105. Fair is fair

Not to proud to admit when im wrong.

Still not sure why people are acting as if he is some henious criminal. While unfortunate, it does nothing to change the facts of the case against Cohen or trump.

[jberryhill]

110. I not sure anyone is acting as if he is some heinous criminal

Quite the opposite.

The bankruptcy proceeding was no secret, nor was the motion for enforcement of the settlement due to untimely payment. That the motion was granted is not particularly surprising, since the settlement agreement is unambiguous as to the time and manner of payment.

I don't see anyone acting as if he is some heinous criminal on account of that. There is a weird sort of behavior to reflexively assume that this unsurprising development on the motion (which was posted about when it was filed) is somehow "fake news", or that simply pointing to the court filings to explain these events somehow equates to being a "Trump supporter".

I don't reflexively believe what anyone has to say about legal proceedings when the record is readily available.

[oberliner]

26. It's not spam

It is real.

[Dawson Leery]

5. And?

Trump has done much worse.

The GOP/Right will do anything to protect themselves and destroy everyone else.

You fight fire with fire. Avenatti is fine by me.

[uponit7771]

63. +1, there's no record of Avenatti tanking companies to stiff paying people

[mahatmakanejeeves]

7. I'm getting that error page too.

ETA, 2:44: it's back now:

https://twitter.com/finneganLAT

Breaking: Avenatti law firm hit today with $10 million judgment in US Bankruptcy Court. Justice Dept lawyer says Avenatti also defaulted on back taxes he’d agreed to pay. Story ahead.

Link to tweet

[SeattleVet]

12. Doesn't matter...

some freepers and assorted other wingnuts will push the story and it will become the next big talking point and conspiracy theory they spread to try to discredit anyone that doesn't fall into line with total praise for Dear Leader.

[PoliticAverse]

18. Huh? It's coming up fine for me....

And it's linked to from his LA Times page:

http://www.latimes.com/la-bio-michael-finnegan-staff.html

https://twitter.com/finneganLAT


<blockquote class="twitter-tweet" data-lang="en"><p lang="en" dir="ltr">Breaking: Avenatti law firm hit today with $10 million judgment in US Bankruptcy Court. Justice Dept lawyer says Avenatti also defaulted on back taxes he’d agreed to pay. Story ahead.</p>— Michael Finnegan (@finneganLAT) <a href="

Link to tweet

?ref_src=twsrc%5Etfw">May 22, 2018</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

[HopeAgain]

20. It is now...

I wonder if Twitter pulled temporarily it until it could be checked out for authenticity or something.

[oberliner]

27. It's a legitimate LA Times account

And the story is published at the LA Times.

[nolabear]

9. This appears to be untrue. Avanatti is pissed. You might want to edit the OP.

[triron]

14. Plz be careful about posting stuff like this. We all should.

[oberliner]

28. The story is true - you might want to edit this response

[beachbum bob]

11. We will see more and more of these attacks...

Until we have laws on the books and real cost and punishment, not going to stop

[OneGrassRoot]

15. We need to do better here...

We need to vet shit before posting and, when possible, it would be extra helpful to post from the original source rather than from sites like Rawstory which rarely produce original content but instead use others' work and content to create articles.

We need to do better.

[jberryhill]

33. Is the court docket good enough for you?

From PACER:

U.S. Bankruptcy Court
Central District of California (Santa Ana)
Bankruptcy Petition #: 8:17-bk-11961-CB

Assigned to: Catherine E. Bauer
Chapter 11
Involuntary
Claims Register


Debtor
Eagan Avenatti LLP
520 Newport Center Dr #1400
Newport Beach, CA 92660
ORANGE-CA
Tax ID / EIN: 32-0210824


05/21/2018 439 Hearing Set (RE: related document(s)436 Generic Motion filed by Creditor Jason Frank Law, PLC) The Hearing date is set for 5/22/2018 at 10:00 AM at Crtrm 5D, 411 W Fourth St., Santa Ana, CA 92701. The case judge is Catherine E. Bauer (Firman, Karen) (Entered: 05/21/2018)

05/21/2018 440
(5 pgs) Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof Filed by Creditor Jason Frank Law, PLC (Attachments: # 1 Affidavit Declaration of Jason M. Frank in Support of (I) Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; and (II) Application for Order Setting Hearing on Motion on Shortened Notice # 2 Exhibit A - C to Declaration of Jason M. Frank # 3 Exhibit D - F to Declaration of Jason M. Frank)). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 441
(6 pgs) Declaration re: Telephonic Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 442
(12 pgs) Declaration re: Email Notice of Hearing on Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC Filed by Creditor Jason Frank Law, PLC (RE: related document(s)436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

05/21/2018 443
(4 pgs) Proof of service (Amended) re Application for Order Setting Hearing on Shortened Notice; Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; and Supporting Documents Filed by Creditor Jason Frank Law, PLC (RE: related document(s)435 Application shortening time re Order Setting Hearing on Shortened Notice, 436 Motion for Entry of Judgment Against Eagan Avenatti, LLP and in Favor of Jason Frank Law, PLC; Memorandum of Points and Authorities and Declaration of Jason M. Frank in Support Thereof). (Chenetz, Sara) (Entered: 05/21/2018)

[Blue_true]

45. Where is there a ruling by the judge?

ALL you posted were motions. Motions for entry of judgement ARE NOT rulings in the applicant's favor.

[jberryhill]

47. No shit

And if you look at that docket I posted, you would also note that a hearing on the motion was scheduled for 10AM today, and I specifically pointed out that a hearing was scheduled for today. The result has not been posted to PACER as of yet.

There is no indication that the hearing wasn't held. The LA Times claims to know what the result was.

Avenatti's tweet does not deny that an order was entered against Eagan Avenatti LLP. His tweet states that it is a "different law firm". Indeed it is a different law firm than the one he practices under now.

[OneGrassRoot]

96. I stand by my statement...

The OP had a link to Rawstory and a tweet. When many of us went to Rawstory, the link to the LA Times article wasn't working.

The tweet showed someone without that blue checkmark, the lack of which makes credibility questionable these days when the person in question is in media or politics especially.

Had the OP linked DIRECTLY to the LA Times article things likely would have played out much differently.

THAT is my point. Link directly to a reliable source, not sites like Rawstory and tweets that don't even have a link to the story embedded in said tweet.

[jberryhill]

97. Good points

You're right. It's poor form on my part to be snarky about early comments before all the facts are in.

That's why I usually go to the court docket before commenting on legal stories.

[OneGrassRoot]

106. Thank you! n/t

[LenaBaby61]

16. The long knives as we know ....

Are out for Michael Avenatti.

I'm expecting MORE shit (Some may be true, some LIES of course) to be flung @ him by right-winged assholes loyal to their Dear Leader.

[jberryhill]

31. This proceeding goes back to March 2017

So it's not some sort of development out of the blue.

[bench scientist]

41. Love how you hit them with facts counselor! lol keep it up -bench nt.

[PoliticAverse]

22. Story online at the LA Times website...

The law firm of Stormy Daniels' attorney Michael Avenatti was hit with a $10-million judgment Tuesday in U.S. Bankruptcy Court after he broke his promise to pay $2 million to a former colleague.

Judge Catherine Bauer of U.S. Bankruptcy Court in Santa Ana ordered the Eagan Avenatti law firm to pay the $10 million to Jason Frank, a lawyer who used to work at the Newport Beach firm.

"At this point, that's what's appropriate," Bauer said at a brief hearing.

To settle his law firm's bankruptcy, Avenatti had personally guaranteed that the $2 million would be paid to Frank last week, but both he and his firm failed to turn over the money.

Read the rest at: http://www.latimes.com/politics/la-na-pol-avenatti-bankruptcy-20180522-story.html

[oberliner]

29. Everyone who gave the OP crap for posting this should apologize

[Kingofalldems]

36. Here's something much more important:

Link to tweet

[blogslut]

52. But, but, shiny thing!

[uponit7771]

62. +1, much more relevant than what happened to an older firm of his

[Kingofalldems]

43. He won't be stopping anytime soon.

Too bad for all the Trumpophiles,eh?

[uponit7771]

49. I'm still asking why is this relevant to anything ?!?! He's not there anymore

[Kingofalldems]

71. It's not relevant.

Just some people have nothing else in their defense of Trump.

[uponit7771]

74. ah

[Kingofalldems]

76. Check out my bulletin up thread.

[jberryhill]

78. He's not where anymore?

He, Michael Avenatti, and his current firm, Avenatti and Associates, guaranteed repayment of the debt to the private creditors and the government.

[uponit7771]

82. They can't repay it, not the first time a company goes belly up. Is Avenatti stiff

[NCTraveler]

51. How many people does that constitute? nt.

[Kingofalldems]

75. Bulletin from the great Michael Avenatti:

Link to tweet

[VMA131Marine]

23. Did anyone else know that Avenatti sued Trump and Mark Burnett (The Apprentice) in 2004

They reached a settlement in 2006 and the details are not public record

[grantcart]

32. Trump/Burnett stole the idea of a show that was going to be called "CEO"

Guy registered the idea pitched it. They told him they weren't interested and then went into production with it.

[Kingofalldems]

35. I see the Trump trolls are digging this story.

[Oneironaut]

37. As much as I've enjoyed Avenatti trolling Trump, they're both cut from the same cloth.

With that being said, I hope the relentless Drumpf trolling continues. Avenatti seems extra talented at sticking it to Trump.

[Cha]

68. No they're not.. not even close.

[uponit7771]

38. Avenatti is saying "Completely different law firm", I'll wait

[oberliner]

53. "Just talked to Avenatti, who acknowledges that the judgment is against his former firm..."

Just talked to Avenatti, who acknowledges that the judgment is against his former firm — Eagan Avenatti — but says it's irrelevant to his work as a lawyer in the Stormy Daniels case. He also said that he personally did not default on any back taxes.

Link to tweet

[jberryhill]

57. The problem there is that his new firm and himself personally guaranteed payment

As noted in the stipulation of dismissal:

https://www.courtlistener.com/recap/gov.uscourts.cacb.1788714/gov.uscourts.cacb.1788714.436.2.pdf

[oberliner]

58. Also, if Eagan Avenatti is his former firm, what is the name of his current firm?

And when did he leave that firm?

[jberryhill]

60. Avenatti and Associates

Noted in the document linked above.

[oberliner]

66. Where does it say "Avenatti and Associates" in that document (Never mind, I found it)

Thanks for the info!

[jberryhill]

67. Uh, first paragraph

[oberliner]

69. As I said, I found it quickly after I posted the question

And I thank you for sharing the doc.

He needs to update his website, which still seems to indicate the Eagan Avenatti name as of 2017.

[uponit7771]

61. Thx, figured it's irrelevant to anything that's going on now with him

[NCTraveler]

50. Maybe he should run for President.

I had been making fun of people mentioning. Shit. We might have a contender on our hands.

[ecstatic]

55. "Justice Dept lawyer says..." We know how much dump likes to project

He's always shouting about a WITCH HUNT!!! most likely because that's what he would (and will) engage in against his enemies. Hmm.....

Either way, good luck, Mr. Avenatti, and thank you for your service.

[jberryhill]

59. The problem with that is....

The DoJ has been engaged on that case for quite some time as it relates to failure to pay withheld employee taxes.

A stipulation was reached with the DoJ back in January - long before his involvement with Stormy Daniels (and we know he was not involved with Stormy Daniels in January, since she had signed the denial back in January and got the Cohen arbitration award in February - neither of which would have happened if Avenatti had been representing her at that time)

https://www.courtlistener.com/docket/6151942/eagan-avenatti-llp/?order_by=desc&page=2

Jan 30, 2018

Notice of lodgment of Order Approving Stipulation Among Debtor, Michael Avenatti, and the United States of America on Behalf of the Internal Revenue Service Regarding Terms of Payment of Taxes in the Event of Dismissal of Bankruptcy Case Filed by Debtor Eagan Avenatti LLP (RE: related document(s)341 Stipulation By Eagan Avenatti LLP and /Stipulation Among Debtor, Michael Avenatti, and the United States of America on Behalf of the Internal Revenue Service Regarding Terms of Payment of Taxes in the Event of Dismissal of Bankruptcy Case Filed by Debtor Eagan Avenatti LLP). (Saunders, Robert) (Entered: 01/30/2018)


--------------

WHEREAS, the United States filed ... a fifth amended Proof of Claim in the amount of $2,357,201.56, which consisted of a secured claim in the amount of $677,410.24, a priority tax claim of $1,259,354.52, and a general unsecured claim of $420,436.80 on October 10,2017 (Claim 1-6).

WHEREAS the United States contends that Avenatti, as a responsible officer of the Debtor, is liable for certain unpaid "Trust Fund" taxes under Internal Revenue Code section 6672, and pursuant thereto has assessed and/or proposes to assess one or more Trust Fund Recovery Penalty ("TFRP&quot against Avenatti.

WHEREAS the United States contends that as of February 28,2018 (hereinafter the "Total IRS Claim&quot , the total principal, penalties, interest that will be owed to the IRS shall be $2,389,004.89, consisting of "Trust Fund" taxes of$I,288,276.63; "Non-Trust Fund" taxes of $311,672.79; penalties of $635,631.58; and interest of$153,424.19.

***

Based upon the foregoing Recitals, the United States, the Debtor and Avenatti, hereby agree as follows:

1. This Stipulation is conditioned upon the entry of a final order approving this Stipulation.

2. Avenatti shall deliver the Initial Payment (described below) to Assistant United States
Attorney Najah J. Shariff (as further described in paragraph 6 below) on or before the 10th calendar day following the entry of the Order Granting Motion for Order Approving Settlement and
Dismissing Case (hereinafter "Settlement and Case Dismissal Order&quot , and further provided that if
the 10th calendar day falls on a weekend or National Holiday, the Initial Payment shall be due on the next calendar day that is neither a weekend or National Holiday (hereinafter, the "Initial Payment Due Date&quot . The total amount of the Initial Payment is $1,508,422.30, consisting of all of the "Trust Fund" taxes in the amount of$I,288,276.63, and 20% of the "Non-Trust Fund" taxes due as of February 28,2018, in the amount of$220,145.70. Once applied by the United States, the Initial
Payment shall constitute full satisfaction of (a) all "Trust Fund' taxes owed by the Debtor for the tax periods as set forth in the fifth amended Proof of Claim, Claim 1-6; and (b) all claims held by the United States on behalf of the IRS against Avenatti for TFRPs for the tax periods as set forth in the fifth amended Proof of Claim, Claim 1-6.

3. After receipt of the Initial Payment, the remaining balance due by the Debtor to the United States shall be $880,582.91 (the "Remaining Balance&quot . Interest shall accrue on the Remaining Balance at the rate determined by applicable nonbankruptcy law pursuant to section 511 of the Bankruptcy Code, the current rate is 4%.

4. The Debtor has agreed to pay the Remaining Balance within 120 days from the date of the entry of the Settlement and Case Dismissal Order as follows:

(a) $440,291.45, plus accrued interest at the rate determined by applicable nonbankruptcy law pursuant to section 511 of the Bankruptcy Code, on the 60th day following the date of the entry of the Settlement and Case Dismissal Order; and

(b) $440,291.45, plus accrued interest at the rate determined by applicable nonbankruptcy law pursuant to section 511 of the Bankruptcy Code, less credit for any adequate protection payments made by the Debtor pursuant to the cash collateral stipulations (the "Cash Collateral Stipulations&quot in the bankruptcy case that have not been applied as of the date hereof, on the 120th day following the date of the entry of the Settlement and Case Dismissal Order.

5. If the Initial Payment is not paid, such that it has not been received by counsel for the United States by close of business on the Initial Payment Due Date, then the Settlement and Case Dismissal Order and this Stipulation shall not become effective, and shall be null and void, with each party hereto reserving its/their respective rights.

6. All payments made pursuant to this Stipulation shall be made to the "United States Treasury", stating in the memo line, the Debtor's name, employer tax identification number, and the case number, and directed to:

U.S. Attorney's Office, Tax Division
Attn: Najah J. Shariff
300 N. Los Angeles St, Ste 7516
Los Angeles, CA 90012

7. All payments made under this Stipulation shall be deemed paid on the date received.

8. This Stipulation shall be binding on the Debtor, any committee, any subsequent trustee, Avenatti, the United States, or their successors.

---------

As with the settlement with the private creditor, payment of the taxes owed was guaranteed personally by Avenatti.

[MGKrebs]

56. I suppose it's significant if he runs out of money and can't continue what he's doing,

but who knows.
His income will maybe be garnished or something.
I'll bet there is a book deal in his future that could help. Plus, with his high profile now he's likely to get lots of opportunities to represent some lucrative cases.

[uponit7771]

64. +1

[Vinnie From Indy]

70. LOL!

Some of the posters on this thread are as a subtle as a hurricane.

[oberliner]

72. Agreed

The Avenatti fandom is off the charts.

[unblock]

83. wow, this subthread is hilarious!

[Kingofalldems]

98. And Trumpites fear him and hate him.

And riddle threads with negative posts about him.

[jberryhill]

116. Just out of curiosity

Do you often accuse people who tell the truth of being trolls and "Trumpites"?

Because it is those of you who ignored the evident truth about this grifter, and propped him up as a hero for our side, who have done us all harm with this evident con man.

Given your consistent arrogant sneering at those who could see the truth, I'll bet you never admit you were taken in.

[Kingofalldems]

117. I guess you should have responded a year ago.

Check this thread carefully and you'll see what I meant.

[Kingofalldems]

107. Bulletin:

Link to tweet

[DeminPennswoods]

73. Donnie Deutch was on with Nicolle Wallace

defending his BFF Michael Cohen and brought up the court judgement against Avenatti. He also said Cohen told him that some things Avenatti says are just not true. Heilman then pointed out that whatever else, so far everything Avenatti has put out to the media has turned out to be true. Cohen, maybe not so much.

[uponit7771]

79. Has Fuck Rodd falsely equivocated anything regarding this .... yet ?

[miyazaki]

77. I'm hopin' that basta isn't pasta.

[unblock]

80. this is like when rock bands break up and become solo artists.

the beatles and creedence clearwater revival and many others had legal battles after they broke up. the rest of us may of may not care about the gossip, but generally we all move on and enjoy their solo careers.

so his previous legal partnership broke up and has some ongoing disputes. big deal. unless i hear at least some kind of allegation of wrongdoing, i'm not interested or bothered.

[jberryhill]

84. The private party end of it at least

The DoJ/IRS, not so much.

He is also personally liable for the agreement with the tax division of the DoJ, to which he also stipulated.

[unblock]

101. is the tax liability itself disputed? or is it the allocation of liability among the partners?

or does it sound like he just doesn't have the money?

[jberryhill]

102. Docket Entry 342

Jan 30, 2018

Notice of lodgment of Order Approving Stipulation Among Debtor, Michael Avenatti, and the United States of America on Behalf of the Internal Revenue Service Regarding Terms of Payment of Taxes in the Event of Dismissal of Bankruptcy Case Filed by Debtor Eagan Avenatti LLP (RE: related document(s)341 Stipulation By Eagan Avenatti LLP and /Stipulation Among Debtor, Michael Avenatti, and the United States of America on Behalf of the Internal Revenue Service Regarding Terms of Payment of Taxes in the Event of Dismissal of Bankruptcy Case Filed by Debtor Eagan Avenatti LLP). (Saunders, Robert) (Entered: 01/30/2018)

---
WHEREAS, the United States filed ... a fifth amended Proof of Claim in the amount of $2,357,201.56, which consisted of a secured claim in the amount of $677,410.24, a priority tax claim of $1,259,354.52, and a general unsecured claim of $420,436.80 on October 10,2017 (Claim 1-6).

WHEREAS the United States contends that Avenatti, as a responsible officer of the Debtor, is liable for certain unpaid "Trust Fund" taxes under Internal Revenue Code section 6672, and pursuant thereto has assessed and/or proposes to assess one or more Trust Fund Recovery Penalty ("TFRP&quot against Avenatti.

WHEREAS the United States contends that as of February 28,2018 (hereinafter the "Total IRS Claim&quot , the total principal, penalties, interest that will be owed to the IRS shall be $2,389,004.89, consisting of "Trust Fund" taxes of$I,288,276.63; "Non-Trust Fund" taxes of $311,672.79; penalties of $635,631.58; and interest of$153,424.19.

...

[unblock]

103. i'm not entirely clear on this.

is he solely liable for the taxes? or is the liability basically joint and several with the other partner?

does the other partner have a similar stipulation, in which case the partners can still haggle over which one actually pays what?

[onenote]

86. Based on a quick review of the court documents, here's a short explanation of what this is about

Eagan Avenatti, Michael Avenatti's "old" firm found itself in a dispute with a former "employee", Jason Frank, who claimed he wasn't paid what he was owed. Frank started out with a claim for around $18 million including punitive damages. After arbitration, the "allowed" amount of the claim was set at $10 million. Somewhere in the process, Eagan Avenatti declared bankruptcy and Avenatti started a new firm, Avenatti and Associates.

Ultimately Frank reached a settlement agreement with, among others, Eagan Avenatti, Avenatti and Associates, and Michael Avenatti personally. Under the terms of that settlement, Frank agreed to forego $5.15 million of the "allowed" $10 million claim in return for the timely payment, in two installments, of $4.85 million. Those payments were to be made by Eagan Avenatti, but were personally guaranteed by Michael Avenatti in his individual capacity. If the payments were not timely made, Avenatti himself was required to make them "promptly" and without demand or notice. In addition, if the payment of the $4.85 million was not made within the specific time period set forth in the settlement, the full $10 million became due from EA.

As I read the agreement, therefore, it would appear that Avenatti himself is on the hook for at least $4.85 million. Whether he is also on the hook for the remaining $5.15 is less clear. I would have to read the court's order to know if that is the case and what the basis for the court imposing the full liability on Avenatti would be.

Looking for jberryhill to correct any errors in the above.

[jberryhill]

87. Pretty much correct

The only minor nit was that it was an involuntary bankruptcy petition in the first place. The former partner is something of a, shall we say, unpleasant character.

The other plot left out of that summary is the DoJ/IRS angle.

[onenote]

88. Thanks. I decided not to delve into the DOJ/IRS angle

but as I've said elsewhere, as much as I enjoy Avenatti jerking around Trump, he can be too slick for his own good.

Not my kind of law practice.

[jberryhill]

104. There's another angle concerning timing of certain events

The motions preceding the settlement suggest a certain confidence that things would be looking up soon.

[jberryhill]

112. Coincidentally

Global Baristas LLC managed to get into the identical pickle on withholding taxes.

[treestar]

91. Thanks.

Civil case. No bad guys just disagreements

[onenote]

92. Depends on whether or not you think failing to pay an agreed upon settlement amount

makes you a "bad" guy.

Maybe its not as "bad" as some things one might do. But it's definitely not something I'd expect from a "good" guy.

[treestar]

93. That could happen

Bit at any rate, it has nothing to do with the Stormy case and does not reflect negatively upon it. Which you k ow is the point of bringing this into higher profile

[onenote]

94. It's being brought into higher profile because Avenatti has made himself a high profile guy.

No, it doesn't directly reflect on or impact the Daniels case; but it doesn't reflect well on Avenatti. Anytime anyone jumps into the limelight the way he has -- and I have no problem with his having done so in order to get under the skin of Trump and his claque -- they run a risk of stories that reflect badly on them getting played up in the media.

[treestar]

95. If this is the worst they can come up with

And as usual the right makes it about the people and not the issues.

[Iggo]

89. Yeah? And?

[treestar]

90. What is a bankruptcy judgment ?

Makes no sense. Did they file bankruptcy and get denied relief from a particular judgment? Did someone who owes them money file for bankruptcy and get relief on a judgment that had against the debtor?

[PoliticAverse]

111. Read this post which explains what happened...

https://www.democraticunderground.com/?com=view_post&forum=1002&pid=10645213

[stonecutter357]

108. #facknews !

[radical noodle]

113. I don't see how this changes anything

in the Stormy Daniels case(s) or with Cohen or Trump.