Michael Avenatti agreed Wednesday to give up financial control of his law firm to settle a dispute with a former partner who claimed the celebrity lawyer hid millions in order to fund his lavish lifestyle and avoid having to pay a $10 million judgment.
Jason Frank, a former partner at Eagan Avenatti, accused Avenatti in a court filing of spending extravagantly: $13,000 in rent for his Los Angeles apartment; a $3,640 payment on his Ferrari; $150,000 for his coffee company; $53,600 on his ex-wife; and $232,875 for his auto racing team, The Los Angeles Times reported.
Frank also claimed that Avenatti hid millions in legal fees from creditors during bankruptcy proceedings and asked the court to appoint a receiver to take possession of the firm’s bank accounts, computers and other assets.
Avenatti, whose client list included porn actress Stormy Daniels, denied any wrongdoing, calling Frank’s claims “much to-do about nothing” and that “every dollar has been properly accounted for and reported as required and as previously set forth in numerous accountings.”
He will still act as the lead lawyer in his new firm, Avenatti & Associates.