Pay to Play

The son of a world—renowned chef says he wanted to reform the phone industry. The feds say he wanted to get rich quick.

"The people at AT&T went straight to the FBI for a reason," he says. "They wanted to scare the shit out of anyone who would ever think about doing something like this."

Daniel David's trial began in March 2004. By then, his friendship with Scott Nisbet belonged to the past. Federal prosecutors had persuaded Nisbet to plead guilty to one count of mail fraud before the start of David's trial. But as part of the agreement, the feds stipulated that his sentencing occur after David's trial.

The tactic in effect removed Nisbet as a potential asset in David's case. If called as a defense witness to corroborate Daniel's testimony, Nisbet would invoke his rights against self-incrimination to avoid potentially jeopardizing his plea deal. He intended to save his own scalp.

Narsai David, for one, wished Daniel would ape Nisbet's example and acquiesce, according to sources who know both Davids. (Narsai declined to comment to SF Weekly.) Daniel chose to soldier on, a decision many of his friends applaud.

"This was a witch hunt by AT&T," says Jack Frater, who first met the Davids through a mutual friend in the mid-1970s. Frater, who gave Daniel the nickname Tigger for his exuberance as a boy, admires his friend for refusing to impale himself on a plea deal. "He's not going to say he's guilty for something he didn't do."

Other friends of the David family suggest Daniel succumbed to "misplaced pride," as one puts it. The person asked to remain anonymous, fearful of risking friendships with the two David men. "I think there was a disconnect between [Daniel's] moral sense and what he was doing with Scott Nisbet. They had good intentions when they started, but then the whole thing got away from them."

Those who know Narsai and Daniel describe them as close, if less than inseparable. Daniel grew up watching his father evolve into one of the country's best-known chefs, a gourmet at ease sharing kitchen or dais space with Wolfgang Puck and Paul Prudhomme. His eatery in Kensington, Narsai's Restaurant, reigned among the region's prominent fine-food establishments during a 16-year run that ended in 1986. Daniel served as everything from busboy to maitre d' to musical guest, his alto sax providing the bass line to the room's easy charm.

But friends insist the closing of Narsai's Restaurant, if sad for patrons, didn't knock Daniel's career ambitions from orbit. He ran his father's catering business for a few years, and while attending college in California and Arizona, he spent his summers in France, working with chefs who knew Narsai. Even so, a passion for art outweighed Daniel's love of cooking, and Narsai refrained from foisting his culinary legacy on his son, whom he's quick to call the better chef.

"Narsai's enormously proud of Danny," Hollie Webster says, "but watching his son go through this has also been enormously hard on him."

Daniel's case likely would have dodged media attention if he were a pipe fitter's kid. Narsai fretted that the publicity clinging to the case would harm Daniel's psyche, as news accounts invariably referred to the younger David as "celebrity chef's son."

Federal prosecutors depicted him differently: as a telecom con artist who swindled millions of toll-free subscribers, despite each receiving only a single hang-up call, and countless long-distance carriers. They also disputed his pretrial claims that he and Nisbet planned to use their survey's findings to bring a class-action suit against long-distance carriers on behalf of pay-phone operators. The duo failed to earmark any of the funds they earned in dial-around compensation for such litigation, prosecutors asserted, and spent about half of the $444,000 on their legal defense.

David admitted on the stand that "the idea of making some money was certainly attractive." But a $2,500 trip to Hawaii, a $3,700 furniture purchase, and a $4,000 wine deal represented his most lavish expenditures with the dial-around proceeds. Prosecutors also skewered him for dining at upscale eateries most days, a point Webster counters with a sigh. "That's what he's always done. What's a guy without a kitchen supposed to do?"

Thomas Carlucci, David's attorney, argued that the money barely influenced his client's life, and that much of the profits went to covering overhead on the business and paying back loans. Carlucci, who refused to comment to SF Weekly, portrayed Nisbet as the scheme's prime culprit, the high-tech guru whose insistence on using aliases doomed the duo's purpose.

The jury found the prosecution's narrative more persuasive, convicting David after a weeklong trial, perhaps influenced by what Carbone refers to as the "ski-mask theory": If a person conceals his identity, no matter the ulterior ideal, he must be doing something wrong. In May 2005 U.S. Circuit Judge Susan Illston sentenced David to 30 months in prison and ordered him to pay restitution of $444,000. (For pleading guilty, Nisbet received a 15-month term; he walked out last year.)

At that hearing, Assistant U.S. Attorney Stacey Geis, who inherited the case from the prosecutors who handled the trial, made a startling admission: The long-distance carriers, rather than losing money, profited from David and Nisbet's scheme. "The phone companies here are not the victims," Geis said. "They were unjustly enriched in the same way the defendants were unjustly enriched."

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