Trump attorney Michael Cohen under criminal investigation, court filing shows


NEW YORK, April 13 (Reuters) - A U.S. prosecutor on Friday attacked a claim by President Donald Trump's longtime personal lawyer Michael Cohen that many of the materials seized this week in FBI raids on Cohen's office and home as part of a criminal investigation should remain private.

In a court filing on Friday, federal prosecutors also confirmed that Cohen has been under criminal investigation for months, largely over his business dealings rather than his legal work.

At a hearing in Manhattan federal court, Assistant U.S. Attorney Tom McKay accused Cohen of trying to hide behind a legal doctrine known as attorney-client privilege to avoid disclosing materials related to the president and other cases.

These could include claims by Stormy Daniels, the adult film star who claimed to have had a sexual encounter with Trump in 2006. She wants to be freed from a nondisclosure agreement under which she was paid $130,000 to keep quiet about that encounter shortly before the 2016 presidential election.

SEE ALSO: Michael Cohen seeking to block probe of records seized by FBI

Cohen's lawyers asked U.S. District Judge Kimba Wood at the hearing to let them review the seized materials to ensure that there was no violation of attorney-client privilege, which permits clients to shield communications with their lawyers.

Uncertainty over exactly what Federal Bureau of Investigation agents seized from Cohen comes as Trump faces an intensifying probe by Special Counsel Robert Mueller into whether his presidential campaign colluded with Russia.

"The attorney-client privilege can't at the same time be used as a sword (and) as a shield," McKay told Wood.

"What they are trying to do is use attorney-client privilege as a sword to challenge the government's ability to review evidence" obtained lawfully, McKay added.

Michael Avenatti, a lawyer for Daniels, suggested at the hearing that his client might be the subject of some of the seized materials, and her interests needed protection as well. Daniels' legal name is Stephanie Clifford.

More on Stormy Daniels' relationship with Donald Trump 

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She says: In Touch never paid her for her story

Daniels says she was never paid the $15,000 she was originally offered by In Touch for the story of her alleged affair with Trump.

She says: Her sexual encounter with Trump was consensual

Daniels had said during the "60 Minutes" interview that she didn't want to have sex with Trump – but when asked by Anderson Cooper if the encounter with Trump was consensual, the adult film star responded affirmatively, saying, "yes, yes."

She says: Trump's lawyer threatened her and her daughter

As she detailed the aftermath of the alleged affair, Stormy Daniels -- whose real name is Stephanie Clifford -- described a moment in a Las Vegas parking lot when a man threatened her:

"And a guy walked up on me and said to me, 'Leave Trump alone. Forget the story.' And then he leaned around and looked at my daughter and said, 'That's a beautiful little girl. It'd be a shame if something happened to her mom.' And then he was gone."

She says: Trump compared her to Ivanka

"He was like, 'Wow, you — you are special. You remind me of my daughter,'" Daniels told "60 Minutes." "You know — he was like, 'You're smart and beautiful, and a woman to be reckoned with, and I like you. I like you.'"

She says: Trump "brushed aside" his relationship with Melania

When asked by Anderson Cooper about Trump's marriage to Melania Trump, Daniels said Trump "brushed aside" any concern surrounding his marital vows. She said he spoke of his marriage to Daniels, saying:

"Oh yeah, yeah, you know, don’t worry about that. We don’t even—we have separate rooms and stuff."

She says: She spanked Trump with a magazine with Trump on the cover

Stormy Daniels confirmed in her "60 Minutes" interview the earlier report that she had spanked Trump with a magazine featuring himself on the cover.

She says: She was paid $130,000 in hush money

Michael Cohen has confirmed that he paid Stephanie Clifford $130,000 11 days before the 2016 election. A former chairman of the Federal Election Commission has since said this payment may have been illegal.

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'ACUTE INTEREST'

The judge also heard from a new lawyer for Trump, Joanna Hendon, who said the president had "an acute interest" in the case. Hendon, who said Trump hired her on Wednesday evening, urged Wood not to decide who gets first shot to review seized documents until after she files a brief by Sunday night.

"I'm not trying to delay anything but nor do I see a particular rush," Hendon said.

In Friday's filing, prosecutors accused Cohen's lawyers of making the "unprecedented" claim that they should decide which documents are privileged, or else leave the decision to a court-appointed special master.

Prosecutors said they should be allowed to use their own "taint team," or "filter team," to do the job.

Wood ordered the lawyers to reconvene later on Friday.

Monday's raids infuriated Trump, who tweeted "Attorney-client privilege is dead!" on Tuesday.

McKay said Trump's ability to invoke the privilege is "no different" from anyone else's.

A source familiar with the matter has said FBI agents who conducted the raids were seeking information on payments to Daniels and former Playboy model Karen McDougal, who also claims to have had a sexual relationship with Trump.

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- JULY 23: Ninni Laaksonen Miss Finland attends Miss Universe Post Pageant VIP Party hosted by Chuck Nabit, Dave Geller, Ed St. John, Greg Barnhill, Freddie Wyatt, Rob Striker at The Standard Downtown on July 23, 2006. (Photo by Patrick McMullan/Patrick McMullan via Getty Images)
Karena Virginia, along with attorney Gloria Allred, speaks at a news conference October 20, 2016 in New York. Virginia, a yoga teacher and life coach from New York, came forward for the first time on October 20, 2016 to accuse Republican presidential nominee Donald Trump of engaging in inappropriate sexual conduct which occured in 1998. / AFP / DON EMMERT (Photo credit should read DON EMMERT/AFP/Getty Images)
Summer Zervos, a former contestant on the TV show The Apprentice, reacts next to lawyer Gloria Allred (L) while speaking about allegations of sexual misconduct against Donald Trump during a news conference in Los Angeles, California, U.S. October 14, 2016. REUTERS/Kevork Djansezian
EXCLUSIVE: Woman says Trump reached under her skirt and groped her in early 1990s - The Washington Post https://t.co/aUMLUvDi2z

Donald Trump's ex-wife Ivana Trump

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Jill Harth

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Image courtesy of Temple Taggart McDowell

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Miss Washington USA 2013, Cassandra Searles

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Actress Tasha Dixon

(Photo by Paul Archuleta/FilmMagic)

Jessica Drake speaks to reporters about allegations of sexual misconduct against Donald Trump, alongside lawyer Gloria Allred (L) during a news conference in Los Angeles, California, U.S. October 22, 2016. REUTERS/Kevork Djansezian
MELBOURNE, AUSTRALIA - OCTOBER 29: Jennifer Hawkins poses at the Myer Marquee on Derby Day at Flemington Racecourse on October 29, 2016 in Melbourne, Australia. (Photo by Ryan Pierse/Getty Images for the VRC)
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Investigators have also been looking into a possible broader pattern of fraud, tax evasion, money laundering and other possible crimes in Cohen's private dealings, including his work for Trump and some real estate transactions involving Russian buyers, the source said.

(Reporting by Karen Freifeld, Brendan Pierson and Jonathan Stempel; Editing by Frances Kerry and Susan Thomas)

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