2 Who Faked Art Theft Must Pay $605,000

A federal court jury Monday ordered a millionaire plastic surgeon and another man to repay insurance companies $180,000, ruling that a theft of artworks from the physician’s Sherman Oaks home had been faked.

The jury also ordered the surgeon, Kurt J. Wagner, 51, to pay $400,000 in punitive damages to the Federal Insurance Co. and the Great American Insurance Co. A co-defendant, Harvey Rader, 42, of Granada Hills, was ordered to pay $25,000 in punitive damages.

The jury deliberated for about 11 hours over two days before affirming the insurance companies’ allegation that Wagner and Rader conspired to stage the burglary of lithographs and Oriental artworks from the Wagner’s gated Valley Vista Boulevard home six years ago.

Lawyers for the insurance companies argued that Wagner was trying to dispose of some of the art because it had been stolen from the Beverly Hills mansion of Sheik Mohammed al Fassi of Saudi Arabia. Wagner also was trying to collect insurance on other works after learning that he had bought overvalued forgeries, they said.

The jury exonerated two other defendants, Wagner’s wife and former art dealer Neal Krone.

Lawyer ‘Surprised’

Wagner’s lawyer, David Alkire, said he was “surprised and disappointed” by the verdict in U.S. District Court in Los Angeles.

However, Barry Langberg, lawyer for Great American Insurance, applauded the awarding of substantial punitive damages.

Wagner, who has an office on South Beverly Drive in Los Angeles, “was a very wealthy man,” Langberg said. “It takes something like this to do what punitive damages are supposed to do,” he said.

Wagner in 1981 pleaded no contest to a misdemeanor charge of receiving stolen property for his part in the thefts of art from Al Fassi’s Sunset Boulevard mansion, which was noted for its gaudily painted statues, before it was heavily damaged by fire in 1980.

The plea, which was expunged from Wagner’s record, was not admissible as evidence in the civil case.

Drove to House

Rader, however, testified that he drove to Wagner’s home on the night of March 20, 1980, and Wagner helped him load boxes filled with the art into a car.

According to court records, the two men met the previous year, when the Wagners hired Rader, an auto mechanic, to repair and maintain their three Rolls-Royces. They advanced him $2,000 later that year to start an auto repair business in Reseda.

Both sides in the case agreed that Rader introduced the Wagners to Michael Lewis, a chauffeur for Al Fassi, who had been stealing art from the sheik. Lewis pleaded guilty to a charge of grand theft, after police found some of the stolen art in his apartment.

Lewis welcomed the meeting with Wagner, because he wanted to sell some of the stolen art and also because he wanted plastic surgery on his face, lawyers for Great American said.

“Dr. Wagner, who wished to become a collector of fine works of art, was receptive to Lewis, and indeed performed the desired plastic surgery and purchased works of art stolen from the mansion from Lewis with Rader’s assistance,” the insurance company said in court documents.

Ivory Pieces

However, when a criminal investigation began into the Al Fassi thefts, the insurance companies said, Wagner decided to “unload his overinsured artworks” and “to get the sheik’s unique ivory pieces out of his house in a manner in which they could not be traced.”

During the trial, the courtroom became a miniature art museum, serving as home for a Chinese onyx statue, an intricately carved ivory boat, an ornate ivory pagoda and numerous small statues.

Lawyers for the Wagners maintained that the Sherman Oaks robbery was a real one, conducted by Rader after he visited the Wagner home and learned that the burglar alarm was out of order because of rain damage.

The defense alleged that Rader was a “career burglar,” who, when confronted by police, made up a story to avoid prosecution. Langberg told the jury that Rader had been convicted of felonies 17 times in England.

Wagner’s lawyers argued that it would have been impossible for Wagner to have helped load the stolen art, because the surgeon had spent the night with a girlfriend, who testified that he had not been away from her for more than a few minutes at a time. Wagner’s wife was not at home at the time.