A former executive at Nike rival Adidas was recently convicted in federal court in Manhattan of taking part in a similar scheme.

Mr Avenatti threatened to make allegations against Nike public unless they paid the coach $1.5 million, and agreed to hire him and a colleague to conduct an internal investigation.

Nike notified Mr Berman's office, and it was agreed that Nike would then record their conversations with Mr Avenatti.

On March 20 Mr Avenatti spoke with Nike's lawyers by telephone, asking to be paid $25 million for the internal investigation. If he was not paid, he told Nike's lawyers: "I'll go take ten million dollars off your client's market cap. I'm not ------- around."

Mr Berman alleged that Mr Avenatti intended to release the allegations to cause maximum financial damage to Nike - making them public just before the issuing of a financial update, and before the basketball season.

Mr Avenatti "repeated his demands and threats, and graphically described his hold over the company."

He said that, if Nike agree to his terms and pay him $22.5 million, he would drop the threat of a press conference and “ride off into the sunset”.

On March 21 he was recorded remarking: "[have you] held the balls of the client in your hand where you could take five to six billion dollars market cap off them."