UPDATE 2-Trump critic Michael Avenatti arrested in Nike extortion scam -prosecutors

Lawyer Michael Avenatti, who represented adult film star Stormy Daniels in her legal battles against U.S. President Donald Trump, was arrested on Monday and charged with trying to extort more than $20 million from Nike Inc, federal prosecutors said. The U.S. Attorney's offices in New York and Los Angeles separately filed charges against Avenatti, with the California case accusing him of embezzling a client's money to cover his own debts, as well as using phony tax returns to obtain millions of dollars in loans from a bank.

New York prosecutors said Avenatti and an unnamed co-conspirator met with Nike's attorneys on March 19 and tried to extort the company into paying them between $15 million and $25 million and an additional $1.5 million to a client of Avenatti's by threatening to make public allegations against the company. Prosecutors said Avenatti also offered to accept a $22.5 million payment to resolve any claims the client might have, and to "buy Avenatti's silence."

In a March 20 follow-up call with Nike's lawyers, Avenatti said that if his demands were not met, "I'll go take ten billion dollars off your client's market cap ... I'm not fucking around," according to the complaint. The charges were revealed shortly after Avenatti said on Twitter that he would hold a news conference on Tuesday to reveal "a major high school/college basketball scandal" that reached "the highest levels of Nike."

Avenatti gained international fame for representing Daniels, the pornstar whom Trump is accused of paying off shortly before the 2016 election to keep quiet about an alleged affair. Trump has denied having an affair with Daniels. Nike did not immediately respond to a request for comment. (Additional reporting by Jonathan Stempel; Editing by Scott Malone and Susan Thomas)