Michael Avenatti’s week gets off to a very bad start

LOS ANGELES -- Michael Avenatti must pay his former law partner $4.85 million and his firm must vacate its Newport Beach headquarters under superior court judgments issued Monday in Los Angeles and Orange counties.

The money is in addition to the $10 million owed by Avenatti's firm, Eagan Avenatti LLP, and it's owed by Avenatti himself, making Monday's judgment the first time the possible presidential candidate has personally been held liable for the multi-million dollar bankruptcy and subsequent falling out with Jason M. Frank, now a partner with Frank Sims & Stolper LLP.

"There's no two ways about it: Mr. Avenatti is beleaguered," Frank's attorney, Eric M. George, told reporters outside Los Angeles County Superior Court Judge Dennis J. Landin's courtroom.

"At the end of the day, this is money that's owed. No matter how you try to spin it, it comes back to the fact that he took money. It wasn't his and now there's a judgment saying it's owed to my client," George continued.

Landin issued his order, which granted George's motion for summary judgment, about the same time Orange County Superior Court Judge Robert J. Moss terminated Eagan Avenatti's lease in an ocean-view high-rise because the firm hadn't paid its $52,235 rent in four months.

Avenatti did not appear for either hearing. He told the Daily Journal in a text message, "Any judgment issued against me will be deducted from the over $12 million that Jason Frank owes me and my law firm Avenatti & Associates as a result of his fraud," though he didn't say why he believes Frank committed fraud.

He also said he has "no responsibility" for Eagan Avenatti's rent, though he did not respond to a question about who does.

Avenatti's former partner Michael Q. Eagan, now practicing in San Francisco, did not return a phone call seeking comment.

Avenatti lists in recent court filings the Newport Drive office as the address for Avenatti & Associates, but he told the Daily Journal the firm now has a Los Angeles office.

George said Avenatti's claim that Frank owes him money for fraud are defamatory and he noted that Avenatti waived his rights to pursue claims against Frank "long ago." Avenatti agreed in March to pay Frank $4.85 million as part of the firm's bankruptcy.

But Avenatti didn't make the two payments as scheduled, so Frank obtained a $10 million judgment in U.S. Bankruptcy Court, and he sued his former partner in Los Angeles County Superior Court for breach of contract, seeking $4.85 million in damages. Jason Frank Law PLCv. Michael J. Avenatti, BC706555 (L.A. Super. Ct., filed May 16, 2018).

George, a partner at Browne George Ross LLP, described the case as "very simple" in his motion for summary judgment.

"Guarantor waived in advance, and agreed not to assert, any defense to the enforcement of the Guaranty to the 'fullest extent permitted by law,'" George wrote. "The Guaranty was a key component of the Settlement, because of the significant risk that EA [Eagan Avenatti], as a debtor in bankruptcy, would not have the funds to timely make the Settlement Payments to Plaintiff."

Avenatti did not reply to the motion. He filed a notice of removal in U.S. District Court Friday, seeking to transfer the case, but Landin rejected it Monday after reviewing a three-page memo from George that called the move "a stratagem for evading summary judgment" and "procedurally and substantively frivolous."

"We can imagine the peals of laughter accompanying his filing, made with the ostensible belief he had dodged summary judgment," George wrote.

Landin said the petition "does not appear to set forth sufficient reasons to move this case to federal court."

The judge's order for summary judgment requires Avenatti pay Frank's attorney fees as well as interest on the $4.85 million, which George said is $165,753 as of Monday, with $1,328 accruing daily.

Meanwhile, the eviction trial occurred in Orange County Superior Court with no one representing Eagan Avenatti.

Sole practitioner Mark A. Kompa represented the Irvine Co., which through an LLC filed an unlawful detainer complaint against Eagan Avenatti over the missed rent payments. The firm's last check in July bounced, according to the complaint. Avenatti filed an answer to the complaint that said the firm made needed repairs to the property and deducted the cost from the rent.

In a motion, Kompa disputed the claim as "factually without merit whatsoever" and noted that the firm's lease prohibits repairs and rent offsets. 520 Newport Center Drive LLC v. Eagan Avenatti LLP, 18-01014921, (Orange Super. Ct., filed Aug. 28, 2018).

Moss' judgment orders Eagan Avenatti pay the landlord $154,004, which is the amount of back rent minus the firm's $59,761 security deposit.