In a way, the feds are lucky that a federal judge in California is ordering a new trial for Michael Avenatti who stands accused of embezzling millions from clients, according to an attorney who's closely following the high profile case.
“I understand that if the government refers to something in a trial even it isn't the centerpiece of their case, then you better prepare to turn it over to the defense,” said John Shu, an attorney in Orange County and legal commentator. “In a way, the government's lucky to get a mistrial because it would be even worse if the court had convicted Avenatti and it got flipped on appeal.”
On Tuesday, U.S. District Judge James Selna at the Central District of California declared a mistrial over prosecutors' failure to provide the defense with exculpatory evidence. Selna has set a new trial to begin Oct. 12.
“It's going to be a lot of money when you think about all the witnesses the government brought in and it certainly is taxpayer money if U.S. attorneys or assistant U.S. attorneys would want to sit down with him again and go over the trial,” Shu observed.
“It's also a lot of expense for the court. The court had a jury that had to go through voir dire then they had to seat the jury. It's a lot of grief to go through a trial.”
Avenatti was in the Santa Ana federal courtroom defending himself against allegations that he embezzled millions of dollars from his clients.
“The fact that he was paying certain victims from different accounts is highly irregular and very unusual,” Shu told the Southern California Record. “He's been disbarred or at least suspended because he's a felon now but even if he wasn't, that is something that a state bar would seriously consider examining and potentially pursuing because you cannot, as an attorney, take money from a client account, a trust account, then shift it to a different account and pay the litigant later from some other account. It’s extremely unethical and potentially criminal.”
Fox News reported that Avenatti told Selna the financial documents that prosecutors withheld were relevant in proving that he did not defraud his clients.
The government violated the Brady rule, as previously reported by Law360. A Brady violation occurs when prosecutors don’t turn over evidence that could be helpful to a defendant charged with a crime.
“It's not clear as to who exactly is responsible,” Shu added. “Obviously, everybody's focusing on the lead prosecutors but they are not necessarily the ones who are responsible. Avenatti is probably looking to use the data to bolster his claim that the reason the alleged victims did not receive their settlement amounts was because of all the expenses he paid on their behalf. It's not clear to me whether he will be successful but that's what trials are for, to contest the facts.”
Avenatt, a George Washington School of Law graduate, was convicted in New York for extorting some $25 million from shoe company Nike and was ordered to serve two and a half years in prison.
The embattled attorney also faces charges in the Southern District of New York for allegedly embezzling money from porn star Stormy Daniels. There are also proceedings against Avenatti in Orange County concerning taxes on the alleged embezzled money.