MILAN — The first preliminary court hearing to determine whether Domenico Dolce and Stefano Gabbana will have to stand trial for alleged tax evasion was held here Thursday.
Judge Simone Luerti presided over the hearing, which was not conclusive and was postponed to March 25. A source said the hearing was deferred because “the defendants’ lawyers asked for more time to draw their conclusions.” Luerti will evaluate the evidence provided by Milan-based prosecutor Laura Pedio and has the option to dismiss the case if the evidence doesn’t justify moving forward.
The designers, who declined to comment on Thursday, are not skimping on legal advice as they have recruited famed Milan-based lawyer Massimo Dinoia to represent them. Dinoia, a criminal lawyer with a 30-year career, has appeared in countless high-profile cases. He was recently on the front pages of newspapers throughout Italy as the lawyer representing the young woman nicknamed “Ruby Heartbreaker,” who implicated Prime Minister Silvio Berlusconi in a sex scandal. Dinoia decided against defending the woman earlier this month.
Lawyer Alberto Simbari, who works in Dinoia’s office, said “the challenges for fraud and fiscal irregularities do not exist in fact and in law.” Simbari confirmed the designers; Dolce’s brother Alfonso, who is a shareholder of the company; two managers, including board member Cristiana Ruella, and the company’s accountant, Luciano Patelli, are all indicted and represented by Dinoia. None of the defendants attended the hearing.
“There is no reason to be present. The hearing is a filter,” said Simbari, who denied speculation the designers had already paid a fine of 90 million euros, or $121.7 million, to settle part of the alleged accusations. “[The designers have acted] in a legitimate and transparent manner and we reject any accusation,” said the lawyer.
In November, Pedio confirmed that Dolce and Gabbana had been indicted on tax evasion charges. The investigations were initiated by the Guardia di Finanza, an Italian police force under the authority of the national Minister of Economy and Finance.
If found guilty at a trial, the pair could be personally liable for more than $1 billion in unpaid taxes and fines. The designers previously have denied any wrongdoing.
According to the accusations, each designer allegedly evaded taxes totaling 416 million euros, or $569 million at current exchange. The designers issued a statement in May 2009 denying the allegations, which relate to the 2004 sale of the Dolce & Gabbana and D&G brands to the designers’ Luxembourg-based holding company, Gado Srl. They said the accusations were “based on a completely abstract calculation,” which enables the tax authorities to replace the sum actually paid with a hypothetical market value.
There is also a separate criminal probe into supposed tax irregularities at the Dolce & Gabbana group. The accusations address unpaid taxes of 200 million euros, or $273 million.
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