Daniels has been entrenched in a legal controversy with Trump over their alleged 2006 encounter, which he has repeatedly denied.
Avenatti noted that the law applies to those who regularly perform at such clubs and there was no evidence that Daniels had ever appeared there before.
Daniels was arrested, along with two other dancers, at Sirens Gentleman's Club in Columbus.
She is scheduled to be arraigned in Franklin Municipal Court on Friday morning.
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Another detective who was standing back by the bar said he witnessed the "criminal activity".
Daniels' attorney, Michael Avenatti, tweeted the announcement Thursday afternoon. She shoved each of their faces between her breasts, court documents said. Daniels, Miranda Panda of Marion, Ohio, and Brittany Walters of Pickerington, Ohio, were each charged in the undercover operation. Daniels had been accused of touching police officers, including the breasts and buttocks of a female officer.
Daniels canceled her Thursday night performance in Columbus because of the charges. The strip club where she reportedly performed, called Sirens, also declined to comment when asked about the matter. An arrest affidavit said Daniels allegedly inappropriately touched male and female undercover police officers after they threw cash in her direction.
Daniels' attorney Michael Avenatti took to Twitter late Wednesday night to claim the arrest was a set up and that he will fight "bogus charges".
Avenatti blasted the arrest as a "politically motivated sting" and a 'ridiculous use of [police] resources'. "There has to be higher priorities", he wrote.
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'This was a setup and politically motivated. It reeks of desperation. He also said that Daniels is briefly postponing her national tour and will plead not guilty to the charges against her. Columbus police have made numerous arrests utilizing this law.
Just days before the 2016 election, Cohen paid Daniels $130,000 in exchange for her silence.
Through White House officials, Mr Trump has denied the affair, although Mr Cohen has admitted paying Daniels as part of the agreement. The payment might have violated campaign finance laws.
He initially said he used his own money to pay Daniels and was not reimbursed by the president.
The state of OH moved to dismiss the case because it did "not have probable cause to proceed on any of the three charges set forth in the complaints", according to scanned court documents that Avenatti posted to social media.
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