A former client of attorney Michael Avenatti, who won a $4 million settlement with Avenatti’s help after suffering injuries while in custody that left him a paraplegic, sued the embattled attorney Thursday for at least $9.5 million for allegedly failing to provide all of the settlement money.
In the lawsuit filed Tuesday, Los Angeles County resident Geoffrey Johnson names Avenatti and Avenatti’s former law firm partners and associates.
Johnson, while suffering from unspecified mental health issues in April 2011, was wrongly arrested by Los Angeles County sheriff’s deputies, Johnson’s attorney Daniel Callahan alleged. Johnson was twice “driven” to attempt suicide as a result of “abuse” from deputies while in custody, Callahan said.
Johnson jumped from the second floor of the jail and was left paralyzed from his injuries, Callahan said.
Johnson hired Avenatti, who sued for “physical injury and emotional stress,” Callahan said. The county agreed to pay a $4 million settlement in January 2015.
“He took that $4 million” and pocketed it and “then engaged in a four-year coverup,” Callahan alleged at a news conference on Thursday.
“We’re going to do our very best to help Mr. Johnson recover his money,” Callahan said.
Avenatti is facing criminal charges in Santa Ana federal court that include allegations of embezzling Johnson’s money. Referring to his status in the indictment as “Client 1,” Johnson told reporters, “I’m a real person with real feelings and real problems. I’m going to spend the rest of my life in a wheelchair… and I cannot support myself the way I want to.”
Holding up the lawsuit against Avenatti, Johnson said, “This document is a symbol, a new start on a road to recovery.”
When asked what he would say to Avenatti personally, Johnson said, “I wish you had just given me my money.”
Avenatti sent a statement to City News Service declaring the allegations in Callahan’s lawsuit as “old news.”
“Mr. Johnson’s claims are categorically false and frivolous, and his case will be thrown out of court,” Avenatti said.
The issues with Johnson surfaced when the Social Security Administration requested information about Johnson’s income, which included payments from Avenatti out of the settlement. Johnson was receiving Social Security funds for the disabled and would be disqualified if the payments from Avenatti were considered income instead of “advances” on the settlement, according to Callahan.
When Johnson approached Avenatti’s office in November for help with the Social Security requests for information about the payments, nothing was done, Callahan said.
Johnson has since lost his Social Security payments and no longer receives payments from the settlement either, the attorney said.
Avenatti allegedly falsely told Johnson that part of the settlement included a trust that would dole out his money in $1,900 monthly payments, Callahan said.
In March, “things really went wrong for Mr. Avenatti,” Callahan said, when, “he said under oath that he paid Mr. Johnson.”
Avenatti allegedly convinced Johnson to sign a document certifying a “special needs trust,” a confidentiality agreement and a “blurb saying he was an ethical attorney who served him well,” Callahan claimed.
“Now Mr. Johnson is destitute,” Callahan said. “He has no source of income and he’s not getting those monthly payments from Mr. Avenatti and he’s not getting Social Security payments anymore.”
Callahan said Avenatti’s conduct “on a scale of 1 to 100… ranks a thousand. It’s off the charts bad. It is hideous.”
Avenatti, however, said that Johnson “previously agreed on numerous occasions, including in multiple detailed writings which he reviewed, initialed and signed (after a different lawyer reviewed), that I conducted myself ethically at all times, he was kept informed about all aspects of his case, he was provided all monies when due, he had been advanced huge sums for his living and medical expenses, he had received a proper accounting, and he was extremely thankful for my assistance, which was provided after no other lawyer would take his case.”
Avenatti added that “Any claim that Mr. Johnson was `tricked’ into signing documents that he fully read and understood is absurd.”
Avenatti argued that, “But for my assistance, Mr. Johnson would have been convicted of the multiple crimes he was charged with relating to his alleged assault of a nurse and would have been destitute six years ago.”
Avenatti said his legal team “paid his medical expenses and living expenses for years prior to any settlement. And we provided him with settlement monies after we deducted our contingency fee and the huge costs associated with his case as we were entitled to. He clearly is disturbed and it is unfortunate that he is being used by his Republican Trump supporter lawyer and others as part of a `pile on’ publicity stunt to smear me.”
Avenatti provided documents showing Johnson’s initials on documents saying that his attorneys in the settlement “acted diligently and ethically” and that he was fully informed about the terms of the settlement.
The lawsuit also names Avenatti’s former partner Michael Eagan as well as other attorneys in the firm, including Jason Frank and Scott Sims and paralegal and office manager Judith Regnier.
In addition to the $9.5 million, Johnson is seeking punitive damages to be determined later.
Avenatti has been embroiled in a legal dispute with Frank, Sims and Andrew Stolper, who is not among those named in Johnson’s suit, over compensation they say is owed to them. Avenatti has been ordered to pay them $10 million, but it has been mired in bankruptcy proceedings.
In an email to City News Service, Sims said that during that legal dispute with Avenatti, “We recently discovered evidence that he stole Mr. Johnson’s settlement money. We promptly reported what we learned to federal authorities, confronted Mr. Avenatti in open court, and informed Mr. Johnson’s family. We are appalled by Mr. Avenatti’s conduct and hope that Mr. Johnson obtains justice against Mr. Avenatti.”
Eagan and Frank did not immediately respond to requests for comment.
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