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Lawyer feuding with Avenatti moves to seize Stormy Daniels' crowdfunding cash

Michael Finnegan, Los Angeles Times on

Published in News & Features

LOS ANGELES -- An Orange County lawyer has asked a bankruptcy judge to seize much of the $577,000 donated to porn star Stormy Daniels to pay legal bills in her suit against President Donald Trump.

The lawyer, Jason Frank, is trying to collect on a $10 million judgment he won last month against Eagan Avenatti, the Newport Beach firm of Daniels' attorney, Michael Avenatti.

The firm's debt to Frank was among the biggest it promised to pay when it emerged early this year from Chapter 11 bankruptcy protection. Frank, who worked at Eagan Avenatti from 2009 to 2016, says the firm cheated him out of millions of dollars in pay.

He won the judgment after the firm broke its promise, personally guaranteed by Avenatti, to pay Frank $4.85 million.

In papers filed Monday in U.S. Bankruptcy Court in Santa Ana, Frank asked Judge Catherine Bauer to order Eagan Avenatti to give him all legal fees, up to $10 million, that the firm might collect from clients in 54 cases.

One of them is the lawsuit filed by Daniels to void the nondisclosure agreement that bars her from talking publicly about what she says was a 2006 sexual encounter with Trump at a Lake Tahoe resort. She received $130,000 to keep quiet.

Daniels set up an online crowdfunding collection in March to cover her legal bills, security costs and any damages she might be ordered to pay Trump for breaching the confidentiality pact.

By Tuesday, more than 16,500 people had donated just over $577,000, according to the CrowdJustice website that oversees the fund.

Frank, who declined to comment, asked the bankruptcy court for a restraining order to keep Eagan Avenatti from diverting potential legal fees away from the firm to dodge the $10 million judgment.

Avenatti, the firm's managing partner, dismissed Frank's request as baseless.

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