A year ago, celebrity attorney Mark Geragos was involved in quiet negotiations with Nike Inc. to create a blockbuster ad campaign for his client Colin Kaepernick, the controversial football star and political activist.
But on March 15, federal prosecutors allege, Mr. Geragos tried to arrange a discreet meeting of a different kind between Nike and another controversial client. Speaking on the phone with an outside attorney for Nike, prosecutors say, he sought to arrange a meeting between the company and Michael Avenatti, best known as an attorney for adult-film actress Stormy Daniels.
Mr. Geragos emerged Monday as a key figure in extortion charges federal prosecutors brought against Mr. Avenatti. Although Mr. Geragos—identified only as an anonymous co-conspirator—was not charged in the complaint unsealed Monday, prosecutors have detailed an alleged scheme in which he worked with Mr. Avenatti in an attempt to extort more than $20 million from Nike.
In the plot alleged by prosecutors, Mr. Avenatti threatened to publicly reveal evidence that Nike had authorized secret payments to high-school basketball players unless he and Mr. Geragos were paid at least $15 million to $25 million to conduct an “internal investigation.” Mr. Avenatti was charged with extortion and conspiracy.
A lawyer for Mr. Geragos didn’t have an immediate comment. In a series of tweets Tuesday, Mr. Avenatti outlined his allegations against Nike. “A lot of people at Nike will have to account for their criminal conduct,” he wrote.
Mr. Geragos’s alleged involvement with Mr. Avenatti in the scheme to extort Nike is most surprising because of the successful partnership he helped broker between Mr. Kaepernick and the footwear giant—and his effusive praise of the company over the past year.
Mr. Kaepernick was already a Nike client when his career was engulfed in controversy in 2016 over his leadership of social-justice protests by NFL players during the national anthem. Unable to find work for two seasons, he also disappeared from Nike’s advertisements.
But Mr. Geragos helped arrange a new deal between the company and Mr. Kaepernick, and Nike featured him in a controversial and high-profile campaign that rolled out last September. The “Dream Crazy” campaign was built around the line: “Believe in something. Even if it means sacrificing everything.”
“Kudos to @Nike who realized @Kaepernick7 is an All American icon,” Mr. Geragos tweeted at the time.
As recently as February, Mr. Geragos praised Nike on CNN for understanding that Mr. Kaepernick “speaks to what’s best of America.” He added: “Nike understood this and should be commended for it.”
A CNN spokeswoman said Monday that Mr. Geragos, who appeared on the network as a legal analyst, is no longer a contributor to the network.
Described in the federal complaint as being “known for representation of celebrity and public figure clients,” Mr. Geragos has for years been one of the most-high profile lawyers in Hollywood.
His clients have included the late pop star Michael Jackson, who was charged with molestation. More recently, he has represented Jussie Smollett, the actor who Chicago police said faked a hate crime. When Mr. Avenatti was arrested last November on suspicion of domestic violence, he hired Mr. Geragos. Prosecutors did not charge Mr. Avenatti in the matter.
Mr. Geragos has been especially busy lately. In February, he settled Mr. Kaepernick’s grievance against the National Football League, which alleged the league and its teams colluded to keep him unsigned because of his outspoken political views. The grievances of Mr. Kaepernick and Eric Reid, Mr. Kaepernick’s former teammate who was also represented by Mr. Geragos and his firm, were settled for less than $10 million, The Wall Street Journal previously reported.
And through his work for Mr. Kaepernick, Mr. Geragos already had close interactions with Nike.
Mr. Kaepernick emerged in 2012 as one of the game’s biggest stars when he led the 49ers to the Super Bowl and had long been represented by Nike. But by last fall he had been effectively shelved. Mr. Kaepernick had become a free agent after the 2016 season, and Nike hadn’t been featuring him in its advertising or making gear with his name on it.
Around the beginning of 2018, Mr. Kaepernick and his team, including Mr. Geragos, began discussions with Nike executives about changing that, a person familiar with the deal said. Mr. Geragos and Mr. Kaepernick’s representatives told Nike executives in New York they wanted Nike to feature him again—a risky proposition for the apparel giant. Nike is an NFL partner, and the league was still engaged in its high-profile grievance with Mr. Kaepernick.
As the discussions between Mr. Geragos and the rest of Mr. Kaepernick’s team with Nike continued, other apparel companies such as Puma SE and Adidas AG expressed interest in using Mr. Kaepernick, the person said; Mr. Kaepernick’s Nike deal was set to expire in 2019. The negotiations between the two sides led to a rich new deal for Mr. Kaepernick and the high-profile campaign that made its debut in September.
In the wake of the deal, Mr. Geragos boasted about the success of the company’s viral advertisement featuring Mr. Kaepernick and how much it was helping Nike. “For those who judge success by the stock market going up, apparently Nike is on fire,” he tweeted in September.
But six months later, Mr. Geragos allegedly entered a very different type of negotiation with Nike. After that initial phone call with the lawyers for Nike, prosecutors allege that the parties met on March 19 at Mr. Geragos’s office in New York, where Mr. Avenatti said he would hold a news conference to reveal payments from Nike employees to the families of top high-school basketball players—unless Nike paid Mr. Avenatti’s client, a high-school basketball coach, and hired him and Mr. Geragos to conduct an internal investigation.
Mr. Avenatti and Mr. Geragos wanted an answer immediately, according to the complaint. After a lawyer for Nike left a voice message for Mr. Geragos later in the day asking for more time, Mr. Geragos agreed to give them two more days. What they didn’t know was that Nike representatives contacted the U.S. attorney’s office in Manhattan regarding the demands.
—Khadeeja Safdar contributed to this article.
Write to Andrew Beaton at andrew.beaton@wsj.com