Avenatti retains new private defense attorney

SANTA ANA -- Michael J. Avenatti retained a veteran Orange County defense attorney to represent him in his criminal indictment on Wednesday, after a judge rejected his bid to appoint a public defender without Avenatti disclosing his finances.

H. Dean Steward, a sole practitioner in San Clemente with a longstanding federal white-collar practice, appeared with Avenatti before U.S. District Judge James V. Selna for a brief hearing to confirm counsel.

The trial is scheduled June 4, but Steward and prosecutors will soon select a new date "two or three months out, understanding that it's probably quite tentative," Selna said.

Selna said he'll conduct a status conference "every couple of months to monitor the status of discovery and any problems that may arise."

"This case will proceed promptly but on a reasonable basis," the judge said.

The first batch of discovery is ready and consists of about 115,000 pages, mostly bank records, said Assistant U.S. Attorney Julian L. André, who is prosecuting Avenatti with Assistant U.S. Attorney Brett A. Sagel.

Materials seized from Avenatti's law office still are undergoing a privilege review by the U.S. attorney's office, André said. He said some "may contain information of which Mr. Avenatti is not entitled to."

"That's an issue I think we'll need to discuss with defense counsel," André said.

Selna said they should act promptly.

"There's no need to do a privilege review in terms of giving him back his own files," Selna said.

Andre said some of the information is property of Eagan Avenatti LLP, which Avenatti no longer controls.

"So that raises some concerns there. I'm hoping will be able to work that out and work that out promptly," Andre said.

Selna ended the 7-minute hearing by ordering the federal defender to bill Avenatti for the hours his office put into the case, at the rate used by alternate defenders with the Criminal Justice Act Panel, which is about $149 per hour.

Avenatti said outside court that he's never sought to avoid compensating the public defender "100 percent for the time they spent, which to date has been minimal."

"No one is trying to freeload off the government. Period," Avenatti said.

Avenatti said he selected Steward to represent him because "he's incredibly well-qualified and very versed in criminal law matters, has an exceptional track record and knows his way around this courthouse exceptionally well." A State Bar member since 1979, Steward led the federal defender's office in Orange County for 12 years.

Avenatti declined to say why he switched to Steward from Bienert Katzman PC, which also is based in San Clemente. Firm partners Steven J. Katzman and John L. Littrell joined Avenatti for his first appearance on April 1, but they haven't appeared with him since, and Avenatti was temporarily appointed public defenders for his April 29 arraignment.

Bienert Katzman partner Michael R. Williams observed Wednesday's hearing from the audience.

Avenatti said outside court that he and Steward will approach his defense "the same way I would go about handling any case that I was involved in as an attorney."

"We're going to demand facts and evidence be presented before anyone is convicted of anything, and I am highly confident that when this process plays out, that justice will be done," Avenatti said.

Avenatti declined to say whether he'd discussed with Steward the possibility that creditors will subpoena their attorney-client financial agreement, which happened to Bienert Katzman last month.

Avenatti's finances are at the center of the grand jury indictment in the Central District of California, which charges him with 36 counts, including five counts of wire fraud alleging he stole $12 million from five clients, as well as bankruptcy fraud and tax evasion. United States v. Avenatti, 19-CR0061 (C.D. Cal., filed April 10, 2019).

He also is charged with four extortion-related crimes in the Southern District of New York for an alleged plot against apparel giant Nike Inc.

Supervising deputy federal public defender Georgina E. Wakefield cited the cases in an ex parte application filed Tuesday that sought to have her and Chief Deputy Cuauhtemoc Ortega appointed to represent Avenatti "without requiring that he submit a financial affidavit at this stage of the case." Selna denied it within two hours.

Avenatti said after court Wednesday that he's "looking forward to the process in both of these cases."

"We'll see who goes to trial first, me or Don Jr.," Avenatti said, referring to President Donald Trump's son Donald Trump Jr., who is not charged with a crime.

Meanwhile, certified public accountant Brian Weiss, court-appointed receiver managing Eagan Avenatti filed a regular status report on Wednesday that alleges new misdeeds, including Avenatti blocking access to his firm's servers for about 75 days and encouraging Eagan Avenatti clients "to transfer their active cases to an attorney formerly employed by EA.".