The conviction of former attorney Rex DeGeorge (not currently licensed to practice, for reasons which will be obvious) for insurance fraud, perjury and related crimes has been upheld by the 9th Circuit Court of Appeals. Mr. DeGeorge's case provides an object lesson in the perils of overreaching:
DeGeorge was convicted in March 2002 in Los Angeles for attempting to sink the 76-foot custom-built Principe di Pictor.
He previously had received insurance payments after claiming two other boats sank and one was stolen.
According to court testimony, the lawyer and two other men left Viareggio, Italy, on the Principe without a captain on Nov. 6, 1992, and cut holes in the bottom of the boat in an unsuccessful attempt to sink the yacht.
When the men were rescued by Italian authorities hours later, they reported that their hired captain had tried to sink the boat before fleeing in a speedboat.
A more expansive version of this salty yarn is included in the 9th Circuit's opinion:
The government presented evidence that DeGeorge, Ebeling, and a third associate, Gabriel Falco, set out from Viareggio, Italy, on November 4, 1992, for the maiden voyage of the Principe. For the first day of their journey, the yacht was captained by an Italian man named Ramono Romani, who was aided by an additional Italian crew member. When the group reached Naples, Italy, on November 5, DeGeorge dismissed Romani and the crew member.
According to testimony from Ebeling and Falco, the three men left Naples without a captain on the evening of November 6. They sailed for several hours, with DeGeorge and Falco alternating at the helm while Ebeling read and slept. Sometime in the middle of the night, DeGeorge instructed Falco to take the power tools they had purchased a few days earlier and begin cutting holes in the boat. For the next six or seven hours, DeGeorge, Falco, and Ebeling took turns cutting holes and trying to do anything else necessary to sink the Principe, including smashing equipment and opening vents in the engine room to make the boat take on more water. The scene became rather frantic, and at one point DeGeorge even began ramming a dinghy into the side of the yacht. Despite their efforts, and despite taking on a significant amount of water, the Principe refused to sink.
Sometime after daybreak, Italian authorities patrolling the coast spotted the yacht and began to approach. Noticing the Italian ship on the horizon, the three men disembarked the Principe and got into rescue dinghies to await the arrival of the Italians. Falco and Ebeling testified that while they waited DeGeorge devised a story for the three men to explain how they ended up off the coast of Italy with a scuttled yacht.
DeGeorge’s story went as follows: he, Ebeling, and Falco had been in Naples looking for a captain. A man named Captain Libovich, who resembled Robert Redford and claimed to be a former Russian submarine captain, heard of their search and offered his services, along with those of his two crewmen. The six men took the yacht out from Naples for what was ostensibly to be a test drive. The captain and his men each brought aboard two large black duffel bags.
After several hours at sea, the captain and his crewmen overpowered the others and forced them into the cabin of the yacht. The captain and crew then set about cutting holes in the yacht so that it would sink. Sometime near dawn, a black speed boat pulled up next to the yacht. Libovich and his men unloaded their six bags onto the boat, jumped aboard, and sped off.
The Italian authorities were suspicious and held the soggy Americans in custody for a time, but pressed no charges. On returning to the U.S., DeGeorge presented a claim to Cigna, the insurer of the yacht. Cigna investigated, ultimately saw through the charade and brought a successful civil suit to rescind its policy. The trial judge in that case referred the matter to the U.S. Attorney's office, the criminal prosecution ensued and now it's more than just Mr. DeGeorge's boat yacht that's sunk.
UPDATE 9/8/04: Ted Frank at Overlawyered points out the serious lessons to be learned from the long-running saga of Mr. DeGeorge.
FURTHER UPDATE 9/21/04: Martin Grace -- who posted about this case here -- and I received a stern e-mail message today contesting the accuracy of certain characterizations of Mr. DeGeorge and his history. All of the passages quoted in the e-mail, however, came from Ted Frank's write-up, here. Martin has posted the text of that e-mail here, and I've left a comment to that post, for the completists among you. Anchors a-weigh!
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