While the unsettled status of NIL and the looming U.S. Supreme Court ruling in NCAA v. Alston dominate the headlines, the college basketball bribery scandal has quietly resurfaced in two connected cases. Bribes to recruits, families and coaches—and blackmail to reveal bribes—remind that while some things will change post-NIL and post-Alston, other things will remain the same.
Celebrity attorney Michael Avenatti, convicted last year by a Manhattan federal jury of attempting to extort Nike of up to $25 million and depriving AAU coach Gary Franklin of a right to Avenatti’s honest services, argues in a newly filed memorandum that he should only be sentenced to six months in prison. Meanwhile, prosecutors will file their own sentencing memorandum this week. Avenatti, 50, will be sentenced on June 30. His attorneys say the U.S. Probation Office has calculated a guideline range of 135 to 168 months (11 years, 3 months to 14 years) in prison.
Across town, the U.S. Court of Appeals for the Second Circuit has affirmed the convictions of former Adidas consultant Merl Code and client recruiter Christian Dawkins of federal funds bribery. Writing on behalf of a three-judge panel earlier this month, Judge William Nardini rejected the defendants’ argument that bribed coaches weren’t agents of their colleges.
Both cases highlight the corruptive influences on big-time college sports, as well as the involvement of sneaker companies—the same companies that soon could sign college players in NIL states to lucrative endorsement deals.
Franklin hired Avenatti in 2019 to engage in potential settlement talks with Nike, which had let Franklin go. Franklin, Avenatti insisted, was worried about his own legal exposure from bribes of top college recruits. Avenatti warned Nike that he possessed bank records, texts and other documents that would establish Nike officials sought to pay five-star recruits to attend Nike-sponsored schools. Two of the recruits, Avenatti contended, were New Orleans Pelicans forward Zion Williamson, who played at Nike-sponsored Duke, and Boston Celtics guard Romeo Langford, who played at Adidas-sponsored Indiana.
Although attorney ethics rules permit substantial latitude in zealously advocating for clients, Avenatti went too far in seeking compensation for himself. First, while he demanded Nike pay Franklin $1.5 million, he insisted Nike either pay him and a co-counsel as much as $25 million to investigate the company or pay the two $22.5 million and take no action. Second, in a shakedown move, Avenatti threatened to hold a press conference during March Madness, timed to most severely damage Nike’s stock price.
In pleading for leniency, Avenatti stresses that he is a first-time offender, his offense was non-violent and his actions caused no “actual financial loss to any victim.” He notes that, even if he could be portrayed as deceiving Franklin, he played no role in Franklin losing his Nike contract and Nike never offered Franklin a settlement. Avenatti also asserts Nike was hardly a victim since the company “admittedly needed to (and in fact did) conduct an internal investigation of the allegations that were raised in the Adidas scandal.” This investigation, Avenatti says, was intended to “get to the bottom of Nike’s corruption of amateur basketball.”
Given his depiction of relatively innocuous conduct, Avenatti maintains his punishment should be in line with other non-violent economic extortion cases in sports. He cites former Louisville assistant men’s basketball coach Dina Gaudio, whose recommended sentence for an extortion offense, per a plea deal reached earlier this month, is probation. Avenatti also draws attention to relatively short sentences for “the many Varsity Blues cases,” wherein affluent parents defrauded colleges by falsely depicting their children as athletes. Avenatti also notes the nine-month sentence for former Adidas executive James Gatto, who played a key role in the disbursement of secret payments to families of five-star recruits so they would attend Adidas-sponsored schools—behavior Avenatti portrays as more damaging to college basketball than any of his misdeeds. Gatto, like Avenatti, went to trial rather than strike a plea deal.
Avenatti’s other leniency argument centers on his pre-sentence confinement conditions. When oppressive, such conditions can serve as a basis for a lower sentence. Though he is now out on house arrest, Avenatti complains he had been jailed at the Metropolitan Correctional Center in New York, the same facility that housed drug cartel king Joaquín “El Chapo” Guzmán and notorious sexual predator Jeffrey Epstein. “The government,” Avenatti’s memo asserts, “has never adequately explained” why he was placed “in solitary confinement for 24 hours a day.” The memo also claims Avenatti, a high-profile critic of former president Donald Trump, was regularly strip-searched and in one search a guard said to another, “He doesn’t look as tough now as he thought he did when he was going after Trump on TV.”
Avenatti’s legal woes go beyond the Nike case. He faces two other trials stemming from allegations he defrauded his clients, including adult film actress Stormy Daniels.
Dawkins and Code, meanwhile, were convicted in 2019 of planning to pay bribes to former South Carolina assistant basketball coach Lamont Evans, former Arizona assistant basketball coach Book Richardson and other coaches in exchange for steering players to Dawkins’ sports management company after the players declared for the NBA. (Dawkins and Code were also convicted in 2018 of wire fraud and conspiracy connected to the bribing of recruits on behalf of Adidas-sponsored programs at North Carolina State, Kansas and Louisville; their appeal of those convictions failed in January.)
The bribery convictions were predicated on the idea that schools, which receive federal funds, are victims since the bribes inhibited coaches from providing honest services to their schools. On appeal, Dawkins and Code maintain the applicable federal law—18 U.S.C. § 666 (theft or bribery concerning programs receiving federal funds)—doesn’t apply since the coaches neither controlled the spending of federal funds nor worked in a department that used those funds. Judge Nardini dismissed those points as factual distinctions without a legal difference. All that mattered for purposes of the statute, he explained, is that the “the bribed coaches were employees of their universities throughout the course of the charged § 666 scheme.”
These cases suggest that bribes and alleged bribes to recruits, families and coaches will likely continue even if athletes can sign endorsement deals and receive higher value scholarships. Schools and sneaker companies will continue to aggressively jockey for elite talent in a college sports world where pay-for-play will remain prohibited.