Avenatti Class Action Dispute Focuses on Receiver’s Role

Daily Journal (May 22, 2019) The proper role of a court-appointed receiver is taking center stage in the battle for Michael J. Avenatti’s biggest case, as competing attorneys jockey for advantage amid allegations of improper client contact and back-door settlement negotiations. Certified public accountant Brian Weiss has since February been managing bankrupted Eagan Avenatti LLP, and he’s wielding his power in a class action in the 9^th U.S. Circuit Court of Appeals, seeking to have Avenatti’s former partners and current creditors replace Avenatti as counsel. David L. Osias, managing partner at Allen Matkins Leck Gamble Mallory & Natsis LLP, called Weiss’ replacement request “unusual and surprising.” Osias, who is not involved in the case but has extensive background with receiverships, cautioned that while receiver fees are standard, any talk of final payments or attorney fees from the class action is premature because the case is unresolved. Still, he said the receiver may not be well suited to select counsel because his objective “is to maximize recoveries for the benefit of creditors.”