Peculiar, Clandestine Tale Trails Alliance Case Figure : Prosecution: Before his arrest, attorney Lynn Boyd Stites collected boats and aliases, leading a furtive life.

One of the odd things about Robert Allen Newman was the way his mind seemed to wander.

Felix Gonzalez, owner of the Miami boatyard where Newman kept his 65-foot yacht, the Christl Dolphin, and four other vessels, found it hard to get Newman’s attention.

“Robert,” he would say, but Newman did not answer, staring off as though lost in thought. He told people he was a former government scientist, a background that seemed to fit his distracted air. But in hindsight, Gonzalez said, Newman may simply have lost track of “what name he was using that day.”

Until his arrest last November on a lonely stretch of interstate in Southern Illinois, the scientist-yachtsman had been collecting aliases along with his boats. Sometimes he was Newman; other times, Jack Archer or Gary Donald Davis.

His real name was Lynn Boyd Stites, a fugitive Los Angeles attorney and central figure in “the Alliance” insurance fraud and legal corruption case.

Although his behavior seemed peculiar at times, several who knew Stites by other names said they were amazed to learn of his alleged involvement in an elaborate and sophisticated fraud.

“He did not strike me as that kind of guy,” Gonzalez said. “His feet were never here on the ground. I really thought he was a scientist or something.”

A dozen lawyers--most of them from the San Fernando Valley--and six law firm clients and employees pleaded guilty or were convicted in the Alliance case, which involved a scheme to extract millions of dollars in legal fees from insurance companies by rigging and prolonging complex civil litigations in Los Angeles, Orange and San Diego counties.

Stites, 48, who formerly practiced law in Woodland Hills and West Los Angeles, was indicted with the others in April, 1990, in what emerged as one of the largest prosecutions of attorneys in U.S. history.

But Stites, a hair-trigger litigator whom authorities accused of masterminding the scheme, did not stick around to fight the charges.

He vanished shortly before the indictment and remained in hiding until his arrest in Illinois after a routine traffic stop.

Now being held without bail in San Diego, Stites refused an interview request.

Prosecutors with the U.S. Attorney’s office in San Diego, who expect to bring Stites to trial in September on racketeering and mail fraud charges, also declined to discuss his life on the run.

But interviews and public records--including federal court documents filed in Miami, San Diego and Illinois--give details of Stites’ 2 1/2 years in hiding.

Among other things, Stites’ penchant for secrecy and intrigue--described by various associates and witnesses--seemed to prepare him well for life underground.

“He’s a master of deceit. He’s an accomplished liar,” Assistant U.S. Atty. William Q. Hayes said in a court hearing in December, arguing that Stites was a flight risk and should not be granted bail.

Using rented mail drops to establish residence, Stites obtained driver’s licenses for Gary Davis and Robert Newman in Oregon and Georgia.

He proposed marriage to two women under two names, promising a life of wealth and luxury but never explaining the furtive existence he wanted them to share.

He presented himself as a physicist or research scientist who had worked on top-secret government projects. In fact, Stites earned an engineering degree and worked briefly in the aerospace industry before becoming a lawyer--a background that helped with his cover story. Even Stites’ noticeable limp--the result of a nearly fatal auto accident outside a Century City law office six years ago--became part of his new identity. He said an explosion during a lab experiment knocked a heavy test stand on his leg.

Drawing on money he had stashed in Switzerland, Stites was a man on a spree. He had at least $496,000 wired from Switzerland to a Miami bank account, and wrote himself $185,500 in checks from the account in just four months of last year, according to a declaration filed in January by an IRS investigator.

Showing that old habits die hard, he continued to skirmish with insurance companies.

And he indulged his taste for risky, even reckless behavior by flying through speed traps as he crisscrossed the country in his maroon sports coupe.

The Illinois ticket that may have grounded Stites forever was not his first. He was previously cited for speeding in Nebraska, Texas, Colorado and Oregon, according to state motor vehicle records--although in those cases he paid the fines and tooled away without his real identity becoming known.

Stites apparently had frequent contact with members of his family, despite the potential risks of consorting with fugitives. After his arrest, a greeting card from Stites’ ex-wife, Erma Miller, was among the items authorities found when they executed a search warrant at a posh Miami Beach condominium he rented overlooking Biscayne Bay.

In Florida, he apparently was visited by his 20-year-old daughter and at least one of his three sons. And Brandt R. Stites, his 22-year old middle son, appears to have spent time with him in Colorado. When Stites, posing as Gary Davis, rented storage space in Denver for his Corvette, van and power boat, he left word that an employee, Brandt Stites, should be given access to the vehicles, workers at the storage firm told federal authorities.

Despite these contacts and his wealth and toys, Stites must have been lonely, and he spent some time searching for a mate.

About November, 1990, a few months after his indictment, Stites began courting Sharon Barry, a northern California divorcee he met through a dating service. Barry declined to be interviewed, but her relationship with Stites was described in an affidavit filed in Miami in connection with a search warrant request.

According to the document, Stites told Barry his name was Jack Archer, and that he was a nuclear physicist who had been involved in top-secret government projects. He also said he was a millionaire who traveled the world and had a home in Argentina.

At one point, Stites showed Barry more than $100,000 in cash, and offered her $500,000 to quit her job, marry him and move to northern Italy.

But Barry’s suspicions were aroused one time when he emptied his pockets and she saw drivers licenses for Gary Donald Davis and Lynn Boyd Stites.

When Barry confronted him about these documents, “Archer explained to her that the identities related to the secrecy of his work with the government, and he needed to change his identity from time to time for protection,” the affidavit said.

Maybe Stites was spooked. In any case, he told Barry he had to leave on a trip, and he never contacted her again.

An avid skier, Stites also spent time in Colorado, where he continued his romantic quest.

In the personals section of Westword, a Denver weekly, on Feb. 20, 1991, he introduced himself as a “Wealthy Gentleman Skier” seeking an attractive thirtysomething female.

Stites described himself as “a well-educated, very cultured gentleman . . . who is 80% retired after having just sold his successful California business.”

“I’m a good skier, in great shape, who loves outdoors; music, theatre, fine dining, art and good conversation.”

The ad concluded: “Take a chance, you won’t be sorry.”

“That’s funny, isn’t it?” said Angela Martin, a Denver-area woman who took a chance and would have married Stites had their romance not come to an untimely end on the shoulder of an Illinois highway.

“It was a painful experience,” said Martin, who said she once had a nine-hour conversation with Stites but obviously never got to know him.

“I’ll put it this way,” she told The Times. “I’m 33 years old, and I had been in relationships where men were dishonest, but this took the cake.”

As before, Stites told Martin he was a scientist who had been engaged in classified work--although the name he gave her was Gary Davis.

Stites had been divorced in 1989, but he told Martin he was a widower whose wife was killed in Switzerland by a hit-and-run driver. He told Martin he kept money in Swiss banks, and while away on a trip, mailed her a message on tape in which he stated he was in Switzerland.

Once, while Stites was in the shower, Martin saw a driver’s license and credit cards in the name of Robert Newman. But Martin “assumed this was related to top secret work he said he performed for the government,” according to a declaration filed in federal court in San Diego.

Stites bought his maroon Dodge Stealth at a dealership near Denver, using the name Gary Davis and a Portland, Ore., mail drop as his home address. Money for the purchase was wired to the dealership from Switzerland.

As Davis, he also rented space at a storage business for a Corvette, a van and a 21-foot power boat.

The boat was purchased in June, 1991, in the Denver suburb of Aurora for about $14,000 in cash. The sellers, Franklin and Diana Mattox, said they were paid the money by a secretive youth in his late teens or early 20s.

According to Diana Mattox, the youth said that he was reluctant to give his name or address because “his mother was a very famous person” who might be harassed by curious fans. “I thought, ‘Oh boy,’ ” Mattox said.

The boat turned up the following month at a boat shop in Boulder City, Nev., near Lake Meade, where a Gary Davis brought it in for repairs.

Then in December, 1991, Davis reported that the boat, a boat trailer and his Ford van had been stolen overnight from the parking lot of an Aurora motel.

The case was “weird,” Aurora police detective Dennis Jarvis said, because Davis did not show up to file the report until four days after the purported theft.

The van--but not the boat or trailer--was recovered a few days later by police in Las Vegas, N.M. But Davis never came to claim the van, said an employee of a local towing firm where the vehicle was stored.

Davis filed a claim for the stolen goods with Allstate Insurance in Eugene, Ore.--but here, again, did not follow through. The claim was not processed because “we were never furnished with all the documentation that we require,” a claims investigator told The Times.

About the same time, Stites went into the boat business in Florida. He bought the Christl Dolphin in January, 1992, for $164,000. He also paid $360,000 for four large boats that had been damaged by Hurricane Andrew, with the idea of fixing them up to sell them.

To the staff at Florida Yacht Charters & Sales, Inc., the Miami Beach firm that brokered the sale of the Christl Dolphin, Stites’ behavior seemed odd and even outlandish.

He called himself Robert Allen Newman, but said he had a partner, Gary Davis, who also peppered them with faxes and calls during negotiations over the yacht.

Although he was never sure, Florida Yacht sales manager Kent Brennan suspected that Newman and Davis were the same person.

In other ways, Newman seemed quirky--like the time he used his sexy sports car as a drying rack for his socks.

“Here he’s got this $50,000 car,” Brennan recalled, “and . . . there was a pair of socks hanging off the rearview mirror--cheap, thin, polyester, white socks.”

Money for the Christl Dolphin was wired from Switzerland by Michael Ueltschi, an attorney in the Swiss capital of Bern. Ueltschi had performed other services for the Stiteses, such as arranging the lease of a chalet in the elegant resort village of Gstaad, and helping with residence papers so the children could attend Swiss schools.

When Stites was under investigation in the Alliance case in 1989 and the IRS was about to put a lien on his home in Bell Canyon in eastern Ventura County, the attempt was thwarted by the transfer of title to Elizabeth Ueltschi.

Michael Ueltschi acknowledged in a telephone interview that Elizabeth Ueltschi is his mother. But he said he did not understand Stites’ legal battles.

“I transferred him some money, . . . but I had nothing to do with his problems over there,” Ueltschi said.

“I was very much surprised that he is in jail. I know him only as a very serious and nice person.”

Stites proved a smarter lawyer than boatman. The Christl Dolphin came cheap because it needed work, but before putting it in dry dock, Stites took it on a shakedown cruise. In a brisk wind about a mile out in the Atlantic, the backstay broke and the mast snapped--a catastrophic failure that luckily caused no injuries, but established the boat as a money pit.

Stites was on his own because his insurance for the boat was limited to damages in dry dock.

Later, when the boat was taken up the Miami River for repairs, it sustained additional minor damage as it was being hauled from the water.

Bill Barrere, whom Stites hired as captain and foreman to oversee repairs, told his boss it was uncertain whether the dry dock policy would cover repairs for damage suffered as the boat was being lifted into dry dock.

But Barrere said that when he offered to consult a maritime lawyer, Stites grew irate, saying he knew all about lawyers and insurance matters.

After a tireless effort to craft a false identity, Stites seemed miffed at his own success in concealing his true background and expertise. Like everyone else, Barrere thought Stites was a scientist--not a lawyer with a knack for driving insurers up the wall.

“What I thought was odd was the irritation that came over him when it was suggested that I contact an attorney,” Barrere said. “I guess he felt insulted.”

Despite occasional tantrums, Stites could be “very charming,” Barrere said. And when it came to repairs for the Christl Dolphin and Stites’ own nautical education, money was no object.

Barrere said up to a dozen workers were kept busy for months refurbishing the yacht, at a cost of at least $150,000 for labor alone. Needless costs and interminable delays were the rule, because Stites kept changing his mind about what he wanted done.

“It was a joke on the boat that anything we did on the boat we had to do four or five times,” Barrere recalled.

Stites “seemed to have fun being the boss and playing the role of Mr. Boatman,” Barrere said. His attitude was: “It’s my money, and if I want to make a mistake, . . . I’ll pay for it.”

But the Christl Dolphin never made it back into the water. It was still a work in progress when Stites took off for his final spin.

En route to Colorado to marry Angela Martin, he was zipping along Interstate 24 near the small town of Metropolis, Ill., when the game came to an end.

It was nearly 8:30 on Saturday morning, Nov. 21. Stites had just crossed the Ohio River from Paducah, Ky., when he was pulled over for doing 80 m.p.h. Similar encounters had ended happily for Stites, and this one would have, too--except that he had somehow lost the original of his Oregon Gary Davis license.

He showed a photocopy, but the state trooper, Steve Pankey, asked for a second ID. Stites opened the rear hatch and produced a Gary Davis birth certificate. But as he did, Pankey “noticed several small Manila envelopes containing what appeared to be a very large sum of money,” the arrest report said.

Suspecting Stites was a drug dealer, Pankey called for K-9 units, which soon arrived with Nuran and Fanton, a pair of drug-sniffing dogs. Both dogs “alerted to the right rear quarter of the vehicle indicating the possible presence of drugs,” according to Pankey’s report.

In fact, there were no drugs. Either the dogs had smelled cash that had passed through a dealer’s hands, or they had made a fortuitous mistake.

No matter--Stites was finished.

Pankey got a search warrant and went through the car. He found more than $32,000 in $20 and $100 bills, as well as diamonds and jewelry, passes to Disney World, and “miscellaneous documents and notes relating to addresses in Switzerland and Russia,” according to an affidavit filed in federal court in Benton, Ill.

More important, he found identifications for Newman and Stites to go with the one for Davis. He ran the names through the computer, and “Stites” brought up the federal warrant.

The officers were surprised, but gratified, by the notoriety of their catch.

“Apparently, he’s wanted out there big time, isn’t he?” said Illinois State Police Sgt. Robert Baker.

Stites was transported a few days later to the Metropolitan Correctional Center, the federal lockup in San Diego. He remains there, awaiting the fight of his life.

He faces a racketeering charge and 36 mail fraud counts and could get a long prison term if convicted.

Since his arrest, the government has filed a companion civil suit seeking forfeiture of his boats, his sports car and the $32,000 in cash, on grounds they were obtained with proceeds from illegal activity.

His frame of mind is as good as can be expected, said Stites’ lawyer, Jennifer Keller.

He’s “doing as well as anybody can do who’s never been in jail before.” And he is “working hard to help me prepare his case.”

Although there were improprieties by some lawyers in the Alliance case, Keller said Stites never did anything illegal.

His indictment, she said, was politically inspired--a case of prosecutors serving powerful insurance companies by crushing a man who would not kowtow to them.

Keller acknowledged that Stites’ flight did not enhance his prospects for acquittal, but she said that problem is not fatal to his defense.

According to Keller: “Many an innocent person has taken off when he realized the deck was being stacked against him.”

Times Researcher Ann Rovin in Denver contributed to this story.