Domenico Dolce and Stefano Gabbana were just convicted of tax evasion … again. The case stems from an investigation that began in 2008 when Italian tax authorities stepped up their fight against tax evasion. In a verdict issued last June, the designers were convicted of hiding hundreds of millions of euros from Italian tax authorities. Specifically, the court held that Dolce and Gabbana, as well as other company execs, used Luxembourg holding company Gado to avoid paying taxes on royalties of about 1 billion euros ($1.38 billion). The designers appealed the lower court's guilty ruling back in November, and while the Italian court of appeals ruled very similarly today, this time around, the designers each given a suspended sentence of 18 months in jail (down from the their original 20 month sentences). In a separate proceeding last April, based on the same matter, the design duo was fined by Italy’s Tax Commission to the tune of 343.4 million euros (about $440.2 million), plus interest.
Massimo Dinoia, a lawyer for Dolce and Gabbana, who have consistently denied any wrongdoing (you may recall they closed their Milan stores in protest back in July), said they would appeal the decision … again. "I am speechless. We are all shocked. The judgment is inexplicable and we will appeal," Dinoia said after the judgment. Lucky for Dolce and Gabbana, they won't serve time, as Italian law states that individuals with sentences of less than two years don’t actually have to go to prison.