Stormy Side Fight Brews Before Cohen Heads Back to Court

MANHATTAN (CN) – The escalating feud between attorneys for President Donald Trump’s “fixer” Michael Cohen and adult-film actress Stormy Daniels could overshadow the primary focus for Wednesday’s hearing: to sort out attorney-client privilege issues in the ongoing criminal investigation stemming from a raid on Cohen’s properties.

Michael Cohen leaves federal court in New York City on April 26, 2018. (AP Photo/Seth Wenig, File)

Federal prosecutors laid out the agenda for Wednesday’s hearing in the Cohen matter in a two-page memo on Friday.

Three out of five bullet points on that list involve the hunt to determine which files that the FBI seized from Cohen’s home, hotel and office should be designated as privileged.

Retired federal judge Barbara Jones, the court-appointed “special master” in charge of this task, revealed on Tuesday that she has finished reviewing 639 hard copy documents totaling more than 12,543 pages.

Cohen, Trump and the Trump Organization have made 252 privilege designations, her report says.

Jones revealed the files will ultimately be divided among the privileged materials, partially privileged materials, non-privileged materials and “highly personal” materials, defined as “medical records and similar materials.”

Apart from this discovery dispute, the two other matters on Wednesday’s agenda relate to the ongoing, headline-grabbing fight between Cohen and Daniels’ attorney Michael Avenatti.

University of Alabama Law Professor Joyce Vance, a former federal prosecutor with 25 years of experience, warned the government to stay above the fray.

“If I was the prosecutor, I’d duck the drama between Mr. Avenatti and Mr. Cohen, so long as it wasn’t interfering with my case, and see what drops out of their pockets during their fist fight,” Vance said in an interview.

Avenatti’s release of a report describing $4.4 million in suspicious transactions through Cohen’s shell company Essential Consultants LLC opened up a Pandora’s box of influence-peddling scandals hitting the White House.

Two Fortune 500 companies featured in the report — AT&T and Novartis – quickly went into damage control mode, as the first admitted a “big mistake” in hiring Cohen as a political consultant and the second had its top attorney resign.

Follow-up press coverage exposed Cohen’s other potential entanglements with foreign governments like Saudi Arabia and Qatar.

Largely ignoring the content of the report, Cohen accused Avenatti of illegally obtaining the information it was based on through confidential files from the Financial Crimes Enforcement Network.

Turning the tables in tit-for-tat allegations, Avenatti claimed that Cohen disclosed privileged audio tapes related to Daniels to the press late last week.

The mudslinging continued after the Memorial Day weekend with a new filing from Cohen’s attorneys, who wanted presiding U.S. District Judge Kimba Wood to know that Avenatti’s firm recently racked up a big loss in a California court.

“We write to bring to the court’s attention a recent decision by the U.S. Bankruptcy Court for the Central District of California regarding conduct by Mr. Avenatti and his law firm, Eagan Avenatti LLP, which led the Bankruptcy Court to impose a $10 million judgment against Mr. Avenatti’s law firm last week,” McDermott Will & Emery attorneys Stephen Ryan and Todd Harrison wrote in a two-page letter.

“The Bankruptcy Court reviewed a record that included an arbitration panel order that found Mr. Avenatti’s firm ‘acted with malice, oppression and fraud,’” the letter continued.

Judge Wood is expected to hear whether such conduct will be enough to bar Avenatti from representing Daniels in Manhattan federal court.

In anticipation for Wednesday’s hearing, special master Jones billed the court $47,390 for her first phase of work on the case.

The charges cover only the first week of Jones’ work on the case from her appointment on April 26 through the end of that month.

Jones charged $700 per hour for almost 70 hours of work, expenses that will be split half by the government and half by Cohen, Trump and the Trump Organization.

None of the parties objected to the calculations.

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