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Michael Avenatti has been accused of improperly keeping a $4 million personal injury settlement payout away from a paraplegic man, a Los Angeles court heard.
The embattled attorney, 48, was also alleged to have hid almost $1 million from creditors, a hearing was told on Friday.
News - Avenatti - Wire - Bank - Fraud
The news comes as Avenatti was charged with wire and bank fraud on Monday, with federal authorities saying he attempted to extract more than $20 million from Nike.
The hearing held at federal court came as part of Avenatti's former legal partner Jason Frank's case against his old colleague.
Court - Judgment - Avenatti - Frank - Profits
According to a court judgment, Avenatti owes Frank $10 million in unpaid profits from his former law firm Eagan Avenatti, sending his firm into bankruptcy proceedings.
A lawyer for Frank told the US District Court, Central District of California that Avenatti has been concealing cash in a bid to avoid paying his debt.
Court - Avenatti - Law - Firm - Settlement
The court heard that in 2015 Avenatti's law firm won a settlement from the County of Los Angeles in a lawsuit it filed on behalf of Geoffrey Johnson, a paraplegic man with mental health issues.
Although details of the case were not discussed in court, DailyMail.com understands Avenatti sued the County of Los Angeles, the Los Angeles County Sheriff's Department and former Los Angeles County Sheriff Lee Baca on behalf of Johnson in a major personal injury claim.
Frank - Lawyer - Settlement - Contract - Avenatti
Frank's lawyer revealed a $4 million settlement contract signed by Avenatti in January 2015, resulting in a check for $4 million from LA County to his firm Eagan Avenatti.
But according to bank records presented by Frank's attorney Andrew Stolper, Johnson was only paid around $2,900 per month after the settlement.
Records - Stolper - Court - Trust - Account
The records, presented by Stolper in court, show the $4 million was put in a trust account rather than being sent directly to Johnson.
Avenatti described the allegations as 'absolutely outrageous' and said the...
(Excerpt) Read more at: MSN
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