Michael Avenatti has been charged with extortion in court papers filed on Monday by the US Attorney's Office for the Southern District of New York.
Those charges are the result of Avenatti's alleged attempt to receive $25 million in payments from a publicly traded company based on damning information obtained by his client, a college basketball coach.
The company in question is Nike, and the charges against Avenatti were announced shortly after he tweeted: 'Tmrw at 11 am ET, we will be holding a press conference to disclose a major high school/college basketball scandal perpetrated by @Nike that we have uncovered. This criminal conduct reaches the highest levels of Nike and involves some of the biggest names in college basketball.'
A source who has been briefed on the situation tells DailyMail.com that federal agents were expecting that tweet, and took Avenatti into custody within minutes of him posting on the social media platform.
That tweet was shared just a few days after Avenatti spoke with Nike's attorney, and declared what would happen if his demands were not met, according to the complaint filed on Monday.
'I'll go take ten billion dollars off your client's market cap,' Avenatti allegedly said during the call.
He later noted: 'I'm not f***ing around.'
That is not the only case filed against Avenatti either, with a second case accusing the lawyer of bank and wire fraud was also filed on Monday in the Central District of California.
He is facing 50 years in prison for allegedly lying about a settlement amount top s client and defrauding a bank.
Scroll down for video
Just do it: Michael Avenatti (above) has been hit with four counts of bank and wire fraud after he allegedly tried to extort $20 million from Nike
Speaking out: A complaint was filed on Monday by the US Attorney's Office for the Southern District of New York shortly after Avenatti tweeted about the company (above)
These bi-coastal complaints come in the wake of the Mueller probe concluding that neither President Trump or his son Don Jr had colluded with Russia during the election.
Avenatti, who represented President Trump's former paramour Stormy Daniels in her lawsuit against the real estate scion, had previously tweeted that he knew Don Jr would be indicted as a result of a federal investigation.
'Donald Trump Jr. will be indicted before his birthday on 12-31-18. If you doubt my prediction, please check my record over the last 7 months. #Winning,' wrote Avenatti last year.
Don Jr wasted no time in responding to the news of Avenatti's legal woes on Monday by retweeting the lawyer's post from last year and stating: 'How'd that work out for you buddy? #basta'
He also tossed out a few other tweets, including: '#MAGA - Michael Avenatti Getting Arrested!!!'; 'Good news for my friend @MichaelAvenatti, if you plead fast enough, you might just get to share a cell with Michael Cohen!'; 'Karmas a bitch huh. #basta.'
His former client also showed little love for the lawyer on Monday.
'I made the decision more than a month ago to terminate Michael's services after discovering that he had dealt with me extremely dishonestly and there will be more announcements to come,' said Daniels.
'I ask that the media respect my decision to withhold further public comment regarding Mr. Avenatti at this time.'
The events that led to Avenatti's arrest all played out over the past week.
Avenatti allegedly told the attorneys for Nike that he would release damaging information about the company unless they agreed to make multimillion-dollar payments to himself and a second defendant.
That second defendant is listed as a cooperating witness and not identified in the filings, though it is stated that he is a male and a lawyer who represents high profile clients.
It was that individual who first reached out to Nike and the company's lawyers back on March 13.
Two days later he spoke with an attorney for the company and stated that he and Avenatti had information they wished to share with Nike's legal team in person.
The two men then approached Nike on behalf of their client, who is identified as an AAU basketball coach at a California college that previously had a $72,000 deal with Nike.
During that March 19 meeting, court papers claim that Avenatti said that he had proof Nike had made illegal payments to at least three high school basketball player's families.
Those allegations are similar to the ones that have been made against Nike's rival Adidas.
Freaky Monday: The arrest iof Avenatti comes after the lawyer stated as fact that Donald Trump Jr would be indicted and tried to take down his father (President Trump above on Monday)
Karma: Avenatti, who represented President Trump's former paramour Stormy Daniels in her lawsuit against the real estate scion, had previously tweeted that he knew Don Jr would be indicted as a result of a federal investigation
Fall from grace: Geoffrey Berman (above), the U.S. Attorney for the Southern District of New York speaks during a news conference announcing charges
In exchange for his silence, Avenatti demanded that his client get a $1.5 million payment and that he and the other lawyer be brought on to investigate these claims - and be paid between $15 to $25 million.
There would also be a provision in that contract stating Avenatti would be paid double the price of any other law firm brought on to work at the company.
Nike's lawyers were not given much time to think this over either, with Avenatti demanding an answer later that day.
He allegedly informed lawyers at the end of the meeting that if his demands were not met, he would go public with his allegations the next day.
That was March 20, which marked the first day of the NCAA Tournament, as well as the day prior to Nike's release of their quarterly report.
In call to Avenatti on March 19, Nike's lawyer managed to buy two more days to mull over the offer, at which point the US Attorney's Office was contacted by members of the company.
That was how agents were able to hear the March 20 call between Avenatti and Nike's lawyers.
In that recorded call, Avenatti stated he wanted 'a million five for our guy' and to be 'hired to handle the internal investigation.'
He then informed the lawyers for Nike that if they were not willing to do these things 'we're done here.'
Avenatti later launched into an expletive-filled rant according to the complaint.
'I’m not f***ing around with this, and I’m not continuing to play games,' declraed Avenatti according to court documents.
'[Y]ou guys know enough to know you’ve got a serious problem, and it’s worth more in exposure to me to just blow the lid on this thing. I’m just being really frank with you.'
He later continued: 'I’m not f***ing around with this thing anymore. So if you guys think that you know, we’re gonna negotiate a million five, and you’re gonna hire us to do an internal investigation, but it’s going to be capped at 3 or 5 or 7 million dollars, like let’s just be done... and I’ll go and I’ll go take 10 billion dollars off your client’s market cap.'
Then, to drive the point home, he again informed the lawyers that he was 'not f***ing around.'
Ghosted: Stormy Daniels revealed that she had quietly dropped Avenatti as her lawyer (pair above in April 2018)
Passing storm: 'I made the decision more than a month ago to terminate Michael's services after discovering that he had dealt with me extremely dishonestly and there will be more announcements to come,' said Daniels (above)
He then informed the lawyers that an internal investigation for a company like Nike could cost upwards of $100 million, presenting himself as a relative bargain by requesting a tenth of that and saying he would agree to a deal any deal that paid more than $9 million.
The following day, when Avenatti met with the lawyers, that amount had gone up a considerable amount.
In that meeting, Avenatti said that he and his co-counsel would need to receive a $12 million retainer and ultimately be paid between $15 and $25 million for the investigation.
The attorney for Nike informed Avenatti that Nike had never conducted an investigation that cost more than $10 million, and had never once paid out a $12 million retainer.
Avenatti then asked the lawyer if he had ever 'held the balls of your client in your hand where you could take five to six billion dollars market cap off them?'
When asked if Nike could perhaps just pay Avenatti's client and not have to hand over millions to him and his co-counsel, the idea was quickly dismissed.
Avenatti allegedly said that it did not make sense to pay his client an 'exorbitant sum of money' in the case, 'in light of his role in this.'
He then conferred with co-counsel, and upon returning stated: 'If [Nike] wants to have one confidential settlement and we're done, they can but us for twenty-two-and-a-half-million dollars and we're done.'
That was followed by another threat according to the complaint, this time detailing how things would play out after he went public with the allegations against Nike.
'I just wanna share with you what’s gonna happen, if we don’t reach a resolution. As soon as this becomes public, I am going to receive calls from all over the country from parents and coaches and friends and all kinds of people – this is always what happens and they are all going to say I’ve got an email or a text message or – now, 90% of that is going to be bullshit because it’s always bullshit 90% of the time, always, whether it’s R. Kelly or Trump, the list goes on and on – but 10% of it is actually going to be true, and then what’s going to happen is that this is going to snowball,' said Avenatti, who spoke of the scandal being covered in the Washington Post, the New York Times and on ESPN.
He said that the company would 'die,' but then modified that a bit and stated: 'not die but they are going to incur cut after cut after cut after cut, and that's what's going to happen as soon as this thing becomes public.'
Avenatti asked that the deal be on appear by Monday, and was set to go to Nike's office where he would sign the deal.
Instead, he was arrested and taken into custody after a warrant for his arrest was signed on Sunday.
'As alleged, Avenatti used illegal and extortionate threats for the purpose of obtaining millions of dollars in payments from a public company. Calling this anticipated payout a retainer or a settlement doesn’t change what it was – a shakedown,' said Manhattan U.S. Attorney Geoffrey S. Berman.
'When lawyers use their law licenses as weapons, as a guise to extort payments for themselves, they are no longer acting as attorneys. They are acting as criminals, and they will held responsible for their conduct.'
The federal agent who oversaw the investigation also commented on Monday.
'As alleged, Michael Avenatti approached Nike last week with a list of financial demands in exchange for covering up allegations of misconduct on behalf of the company. The lofty price tag included a $1.5 million payoff for Avenatti’s client and upwards of tens of millions of dollars for the legal services of his firm – services Nike never requested,' said FBI Assistant Director in Charge William F. Sweeney Jr.
'This is nothing more than a straightforward case of extortion. In the event anyone needs to be reminded, this type of behavior is illegal and it will not be tolerated – especially when committed by a lawyer who is supposed to use his license to practice law, not to willfully violate it.'