MILAN — The Matteo Marzotto trial will proceed, and it will continue to take place in Milan.
Judge Orsola De Cristofaro on Wednesday rejected requests by the defendant’s lawyers made in November to move the arraignment to a Rome courthouse. De Cristofaro also did not dismiss the case based on the lawyers’ objection to Marzotto being tried despite the payment of a fine.
“The fiscal inspections were initiated in Milan, the notifications were made by the Agenzia delle Entrate in Lombardy [the Tax Agency in the region where Milan stands] and the city’s Guardia di Finanza [police force under the authority of the national minister of economy and finance]. There is no territorial incompetence,” claimed De Cristofaro.
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Neither Marzotto nor his sister Diamante, indicted with other defendants for alleged omission of earnings declaration and tax evasion, were present in court on Wednesday. Matteo Marzotto has in the past declared that he had “always operated in the full respect of the law.”
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The allegations involve the Marzotto family’s association with the sale of Valentino Fashion Group to private equity fund Permira in May 2007 for more than 782 million euros, or $923.5 million at current exchange rate.
Also not present were defendant Bart Zech, administrator of the board of International Capital Growth, a firm the tax police believe to be a fictitious entity based in Luxembourg and managed in Milan, and allegedly created for the purpose of selling 29.9 percent of the Valentino group; real estate entrepreneur Massimo Caputi, and Pierre Kladny, president of the board of ICG.
According to the indictment, taxes on the profit derived from the transaction were never paid in Italy.
De Cristofaro reiterated prosecutor Laura Pedio’s charges that “it was not possible to locate other relevant operations [in other cities], and that decisions were made remotely, a bit in Milan and a bit in Rome.” The issue of Milan’s competence was never raised during the investigations, she noted.
The judge conceded that more than 56 million euros, or $66.1 million had been paid in fines to the Italian State, but underscored that ICG had “its own juridical personality, separate from its shareholders. ICG derived a fiscal advantage, and it matters little that its partners were the ones who paid.”
During the previous hearing, the Marzottos’ lawyer Paolo De Capitani, from the studio of one of Italy’s most notable fiscal lawyers, Victor Uckmar, cited the fourth article of the seventh protocol of the European Human Rights Convention. De Capitani said a defendant “cannot be tried twice for the same fact, or ne bis in idem,” which is similar to the American “double jeopardy.” De Capitani said that, since the Marzotto siblings each paid 1.6 million euros, or $1.9 million, to the fiscal police “to avoid trailing judicial issues” related to the same facts at a fiscal level, they should not be indicted at a penal level. The lawyer made a reference to a similar recent sentence at the highest court level here, the Corte Suprema di Cassazione. In Italy, fiscal trials run parallel but independently of penal ones.
After two earlier delays in 2014, the trial got under way in November. Future hearings are scheduled on March 20, April 10, May 8 and 22. Prosecutor Pedio is expected to ask witnesses from the Tax Agency to testify during the first hearing.