Michael Avenatti outside the Daniel P. Moynihan Courthouse in Manhattan after an April 2018 hearing. Michael Avenatti outside the Daniel P. Moynihan Courthouse in Manhattan after an April 2018 hearing. Photo: David Handschuh/NYLJ.

A Manhattan federal judge on Thursday denied Michael Avenatti's motion to dismiss the third count of an indictment accusing the embattled lawyer of trying to extort Nike Inc. by threatening to go public with allegations that the company made illicit payments to the families of college basketball recruits.

The ruling came just three days after U.S. District Judge Paul G. Gardephe of the Southern District of New York declined to toss two extortion charges against the embattled attorney and vocal critic of President Donald Trump, rejecting defense claims that those counts had not properly alleged "wrongful" activity.

On Wednesday, Gardephe let stand the third count and final count of a superseding indictment, which charged Avenatti with honest services wire fraud related to his representation of Gary Franklin, a California-based youth basketball coach who claimed to have damaging information against the sports apparel giant.

The case involves allegations by the Manhattan U.S. Attorney's Office that Avenatti told Nike he would keep the alleged recruiting violations quiet, so long as the company agreed to settle his client's claims and pay Avenatti between $15 and $25 million to head an internal investigation. Crucially, prosecutors said that Avenatti never told Franklin about Nike's offers to resolve the dispute without paying Avenatti or retaining him for an internal probe.

Nike has denied that it engaged in any wrongdoing, and has not been charged with any wrongdoing.

The government alleges that Avenatti's actions amounted to a bribery scheme that deprived Franklin of his right to honest services in violation of Avenatti's duties of confidentiality, loyalty, honesty and fair dealing to his client.

Avenatti's attorneys, Scott Srebnick and Jose Quinon, moved to dismiss the count on the grounds that the indictment did not lay out a "bribery" or "kickback" scheme required under Supreme Court precedent, saying neither word had appeared in charging documents.

Gardephe, however, said that the indictment tracked the language of the honest services wire fraud statute and contained the necessary allegations of a "quid pro quo."

"Here, as an initial matter, this court is not aware of any case suggesting that the words 'bribe'  or 'kickback' have talismanic significance," Gardephe wrote in a 19-page opinion.

"The quid pro quo alleged in the indictment is that—in exchange for the millions of dollars he sought from Nike—Avenatti would not publicly disclose the misconduct of Nike employees reported to Avenatti by [Franklin]," he said.

The pair of rulings this week cleared the way for a planned Jan. 21 trial in Manhattan.

An attorney for Avenatti was not immediately available to comment Thursday morning.

Avenatti is facing separate indictments in California and New York for allegedly stealing settlements and other funds from former clients, including Stormy Daniels, a adult film star who claimed to have had an affair with Trump.

The president has repeatedly denied having sex with Daniels, whose real name is Stephanie Clifford. Avenatti, however, remains a fierce critic of the president, and has vowed to fight the federal indictments on both coasts.

Gardephe is still expected to rule on a number of pretrial motions in the Nike case, including whether prosecutors will be able to present evidence of Avenatti's distressed financial state to a jury in order to help establish his motive.

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