A federal judge in the Central District of California has cleared the makers of the popular Tabs3 billing software to help prosecutors access data on law firm servers seized by Michael Avenatti.
The underlying argument involved claims of attorney-client privilege by Avenatti, which prosecutors say do not apply to law firm accounting data.
In their response to Avenatti’s opposition to their request, Deputy U.S. Attorneys Brett Sagel and Alex Wyman said the U.S. Court of Appeals for the Ninth Circuit has repeatedly ruled that attorney-client privilege does not cover financial accounting data that does not reveal “research or litigation strategy,” which Tabs data does not.
They also referred to the fact that Avenatti’s law firm is now in the hands of a trustee appointed by the US bankruptcy court.
“Finally, the defendant’s quotes on instances where a client’s lawyer can assert solicitor-client privilege on behalf of his clients ignore the obvious: it is not his clients – and the defendant as unlicensed lawyer has no clients, ”prosecutors wrote.
Avenatti and prosecutors appeared to reach an agreement over a status conference on October 15 with U.S. District Senior Judge James Selna, and prosecutors were to file an order for Selna to approve it.
But Avenatti requested a conference call with representatives of Tabs3 at Software Technology LLC, instead of approving the prosecutors’ proposal, so they filed an ex parte request on October 27 for an order from Selna. In his opposition, Avenatti called the proposed order “flawed and impractical” and said it would effectively give prosecutors access to the data of all clients, not just the five alleged victims in his wire fraud case. .
In their response, Sagel and Wyman called Avenatti’s opposition “just his latest bad faith and obstructionist posture that directly contradicts his previous statements and positions.”
“The court now has two competing order proposals and can easily determine that the government’s proposed order is consistent with that court’s directives and with the law,” according to their Oct. 28 filing.
In a two paragraph order issued on Monday, Selna sided with prosecutors, issuing verbatim the two orders sought for Software Technology LLC. The wording does not correspond to an order but, as prosecutors requested, the company “may provide technical assistance.”
Meanwhile, the Ninth Circuit plans to schedule oral argument in Avenatti’s double jeopardy appeal in February, March or April, although Miami-based Avenatti attorney Howard Srebnick said Monday that it was not available in February.
Avenatti’s opening brief is due on November 30, and the response from the United States attorney’s office is expected on December 30. Avenatti can then file an optional response within 21 days.
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