Nike under ‘ongoing investigation’ by government, attorney at Michael Avenatti trial says
Nike attorney Scott Wilson testified Friday that there is an “ongoing investigation” of Nike by the government and that the shoe company’s internal investigation of corrupt payments to grassroots basketball players is ongoing.
“My understanding is the government’s investigation is still ongoing and, as a result, the internal investigation is still ongoing,” Wilson testified.
Wilson made his statements during the third day of the Michael Avenatti trial. Prosecutors claim that Avenatti, the high-profile attorney who represented adult-film actress Stormy Daniels in her lawsuits against President Donald Trump, tried to extort between $15 million and $25 million from Nike last March. He threatened to reveal proof that the sportswear giant was making illicit payments to families of NBA-bound young athletes such as Deandre Ayton, the No. 1 pick in the 2018 NBA draft who is now with the Phoenix Suns.
Wilson earlier said the Securities and Exchange Commission was investigating Nike.
Avenatti, 48, has denied the charges in this case and in two other criminal cases.
Judge Paul G. Gardephe told defense attorneys that “Nike is not on trial here,” making it clear that he did not intend for the trial to explore whether Nike has been involved in corrupt payments to former high school basketball stars like Ayton, Bol Bol and Brandon McCoy.
“We are not going to pursue a broad exploration of whether Nike was involved in corruption in amateur athletics because Nike is not on trial here,” Gardephe told defense attorneys when the jury was not present.
“It’s not a defense for Mr. Avenatti,” he added.
Nike text messages, emails, invoices
Defense attorney Howard Srebnick spent much of his Thursday and Friday during cross-examination of Wilson essentially trying to get Wilson to admit that he knows about the payments Nike allegedly made to the players, and for which Avenatti has email, text message and invoice documentation.
For example, text messages were shown to the jury Friday in which Nike EYBL director Carlton DeBose asked Cal Supreme AAU director Gary Franklin if he could fly to Phoenix in June 2016 ostensibly to make a $10,000 cash payment to Ayton’s mother, Andrea. This was before Ayton enrolled at Hillcrest Prep in Arizona that fall and before he spent a one-and-done year under coach Sean Miller at Arizona in 2017-18.
“I’m open and free to go,” Franklin texted DeBose.
He added in another text: “OK, let me know and I’m assuming you will fill me in on my mission.”
DeBose responded by text: “Laughing yes sir.”
The defense then showed the jury email correspondence from June 27, 2016 in which Franklin asks another Nike employee, Gabriela Olivares, to make the travel arrangements for Franklin to Phoenix.
Wilson later said he was not aware of Franklin’s flight to Phoenix before the March 19 meeting with Mr. Avenatti.
Nike makes ‘Adidas problem look small’
Defense attorneys also showed an invoice on Nike stationary with the Swoosh at the bottom from June 20, 2016 that involved a $60,000 payment to Franklin’s Cal Supreme program. It was divided into two $30,000 payments for “16U and 15U Travel Expenses” and for “Cal Supreme Back To School Event.”
Srebnick repeatedly tried to get Wilson, the Nike attorney, to concede that he was aware of the payments during meetings with Avenatti.
“Did you dispute the allegations?” he asked Wilson.
At that point, Wilson did not answer and instead looked toward Nike attorney Peter Skinner of Bois Schiller who was seated in the courtroom.
On Thursday, Wilson declined to affirm or deny any corruption on Nike’s part during meetings with Avenatti.
‘I neither affirmed or denied statements that Mr. Avenatti was making about my client (Nike),” Wilson testified. He added: “I didn’t share any facts with Mr. Avenatti regarding my client.”
Srebnick told the jury Thursday that Avenatti told Nike attorneys in March 2019 that “Nike has a problem that makes the Adidas problem look small.”
Avenatti’s trial follows ‘Adidas’ trial
For the third day in a row at the trial, there was no mention of Duke or Zion Williamson.
Avenatti previously claimed without providing documentation that Nike paid Williamson and that Duke coach Mike Krzyzewski was not only aware of the payment, but has been part of such payments to players for years. In September, Duke “found no evidence” Williamson’s eligibility was compromised, according to information provided exclusively to The Herald-Sun and News & Observer.
Duke has denied any allegations.
This latest trial follows the “Adidas” trial that led to the convictions on wire fraud in October 2018 of former Adidas executive James Gatto, would-be-agent Christian Dawkins and Adidas consultant Merl Code for funneling illegal payments to families of recruits in exchange for attending Adidas schools N.C. State, Louisville and Kansas.
In July, N.C. State received a Notice of Allegations from the NCAA for the school’s involvement in the Adidias “pay-to-play” scheme. It alleges that former assistant coach Orlando Early helped facilitate a $40,000 payment from Adidas to former N.C. State star Dennis Smith Jr. as a way to get the player to commit to the Wolfpack. The school responded to those allegations in December.
Avenatti’s trial could get more interesting going forward as both Franklin and his advisor, Jeffrey Auerbach, are expected to testify. The trial resumes Monday.
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This story was originally published January 31, 2020 at 2:05 PM.