Prosecutor: Avenatti arrested on alleged bail violation

Avenatti was arrested by IRS agents on allegations of violating the terms of his pretrial release, said Thom Mrozek, spokesman for the Los Angeles U.S. attorney's office.

The documents were under seal, so Mrozek could not provide details on the allegations.

Avenatti was expected to appear in federal court in Santa Ana on Wednesday.

"I understand that Mr. Avenatti has been arrested by the federal authorities for violating the terms of his release," attorney Steven Bledsoe, who represents a client Avenatti is accused of embezzling money from, told the Daily Beast after being present for the arrest.

Avenatti said, "Completely innocent," as he was being led out of the courthouse, according to the media outlet, which reported that the arrest occurred during a break in testimony.

Shortly after the arrest, federal prosecutors in New York informed a judge there that Avenatti had been accused by prosecutors in California of violating the conditions of his bail.

The court filing did not make it clear what Avenatti allegedly did to violate bail. California court filings on the matter were not available Tuesday evening.

A message seeking comment was left with Avenatti's attorneys.

Avenatti is scheduled for trial next week in Manhattan federal court on allegations that he extorted Nike for up to $25 million. He has pleaded not guilty in that case.

But he also faces trial in May in Los Angeles on charges that he defrauded clients of millions of dollars.

He has pleaded not guilty to those charges, along with allegations in a criminal case in Manhattan federal court alleging he ripped off ex-client porn star Stormy Daniels of proceeds of a book deal. The second New York trial was scheduled to start in the spring.

Earlier Tuesday, Avenatti was on a telephone conference with his lawyers, prosecutors and Gardephe.

During the hearing, the judge refused to postpone the Nike extortion trial scheduled to start with jury selection Wednesday.

Avenatti's lawyers had requested a monthlong delay to study additional documents.

Avenatti has said he has been unfairly targeted by the U.S. Justice Department after publicly quarreling with President Donald Trump.

Gardephe said he'll rule during another telephone conference Wednesday whether to allow evidence about Avenatti's financial condition to be shown to jurors.

Prosecutors say they'd like to show the jury that Avenatti's debts coincided with demands he made early last year  in meetings with Nike lawyers for between $15 million and $25 million.

Assistant U.S. Attorney Matthew Podolsky told Gardephe that Avenatti's law firm would not have been able to stay in business because the firm had a $10 million judgment against it.

Defense attorney Danya Perry said prosecutors exaggerated Avenatti's debts, particularly what the law firm owed, and she disputed claims by the government in court papers that Avenatti owed over $15 million.

"It doesn't get close to that," she said.

Although Podolsky insisted prosecutors needed to reveal the debts at trial to show Avenatti's motivation to seek so much money from Nike, the judge expressed doubt.

Gardephe said: "$15 to $20 million is a very compelling motive to commit a crime even if you don't happen to be in debt. I have to take that into account also."

Perry said the amount of money requested for an internal corruption probe of Nike was first suggested by a Nike attorney rather than Avenatti.