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The State Bar of California is investigating porn star Stormy Daniels’ lawyer Michael Avenatti, Fox News has confirmed, after a complaint was filed regarding allegedly unpaid taxes.
Fox News on Wednesday obtained an April 18-dated letter verifying the existence of the investigation—unrelated to his representation of Daniels.
“The complaint against attorney Michael J. Avenatti has been reviewed and forwarded to the Enforcement Unit for further investigation and prosecution, if warranted,” said the letter from the state bar, written by Supervising Attorney Anand Kumar and reviewed by Fox News.
The letter also provided the names of the investigators reviewing the complaint.
The State Bar of California declined to comment on the letter, when reached by Fox News.
The complaint itself was filed in late March by attorney David Nold of Bellevue, Wash., regarding Avenatti's role in purchasing Tully’s Coffee several years ago through an entity called Global Baristas.
The complaint, first reported by The Seattle Times, said Avenatti and Global Baristas faced a lien for unpaid federal taxes worth roughly $5 million, claiming taxes were withheld from workers’ paychecks but not paid to the government. The complaint from Nold, as posted by The Seattle Times, called into question Avenatti’s “fitness to practice law.”
HEAT ON STORMY DANIELS' LAWYER OVER PAST BUSINESS DEALINGS
According to the state bar's website, an investigation is launched based on a complaint only if the state bar attorney "sees evidence of a serious violation."
But Avenatti told Fox News on Wednesday that the complaint is “completely baseless” and called Nold an “unethical hack of a lawyer.”
Nold, who filed the initial complaint, represents Bellevue Square, which has been in a landlord-tenant dispute with Tully’s Coffee. The Superior Court for the State of Washington found Nold to be in “contempt of court” following an “intentional disobedience of a court order.” Nold disclosed Avenatti’s deposition transcript to The Seattle Times, according to a court filing obtained by Fox News.
“The court ruled that I should not have given the full Avenatti deposition transcript to the news media,” Nold told Fox News last week. “The court found nothing wrong with sending the bar complaint.”
Since the coffee chain purchase, Tully’s has shuttered its stores (though the closures were described as temporary) as Global Baristas has dealt with numerous lawsuits.
The paper trail for that deal is complex.
Fox News obtained a copy of the notice of federal tax lien in question, sent to “Global Baristas US LLC” and “Michael J. Avenatti MBR [member].”
Avenatti reportedly said he thinks Global Baristas has paid the outstanding taxes. Further, Avenatti claimed to Fox News last week that he wasn’t a “member” of Global Baristas US LLC—but rather the entity that owned it, Global Baristas LLC.
“The federal tax lien is related to an entity that was owned by another company that I used to have an interest in,” Avenatti told Fox News. “At no point in time was I ever responsible for any taxes for Global Baristas US LLC, nor was I ever a member of that entity, nor did I own any direct interest in that entity.”
However, a 2017 court document posted by The Seattle Times shows Avenatti acknowledging he was the “principal” of Global Baristas US LLC.
Avenatti, though, strongly disputed the complaint itself last week in an email to Fox News, calling it “complete and utter nonsense.”
Nold told Fox News in an email that this is "just Avenatti being Avenatti."
Meanwhile, another lawsuit was filed back in 2013 against Avenatti by his famous business partner, Patrick Dempsey of “Grey’s Anatomy” fame. Dempsey's complaint against Avenatti, which was settled quickly, alleged Avenatti had not fully financed the coffee chain as agreed.
Avenatti no longer has any interest in either Global Baristas entity.
The attorney was surely the lesser known partner in that Tully's deal.
But since then, he's rocketed to national fame with his representation of adult film star Daniels, whose legal name is Stephanie Clifford.
He made waves last week when he tweeted bombshell allegations against Trump attorney Michael Cohen, citing financial records to accuse Cohen of receiving $500,000 from a Russian oligarch-tied company, in addition to other hefty payments from other companies for his supposed insight on the administration.
Cohen is under criminal investigation as part of a grand jury probe into his past business dealings. Included in the investigation is a $130,000 payment to Daniels in the weeks leading up to the 2016 presidential election in exchange for her silence about an alleged sexual encounter with Trump in 2006.
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