Walburga "Dolly" Oesterreich was born in Germany in 1880 and later immigrated to the United States. She married Fred William Oesterreich, a wealthy textile manufacturer specializing in aprons. The couple settled in Milwaukee, Wisconsin, and were prominent members of the local German community. Despite their affluence, the marriage was troubled; Fred was known for his hard-drinking habits and was often away managing his business.

In 1913, Dolly met 17-year-old Otto Sanhuber, a sewing machine repairman employed at Fred's factory. Their acquaintance quickly developed into a clandestine affair. To avoid suspicion and facilitate their relationship, Dolly suggested that Otto secretly move into the attic of their home. Otto agreed and lived in the attic unnoticed by Fred, dedicating his time to reading and writing, while maintaining his affair with Dolly.

In 1918, the Oesterreichs relocated to Los Angeles, California. Unbeknownst to Fred, Dolly ensured their new home also had an attic, where Otto resumed his hidden residence. This arrangement continued until the night of August 22, 1922.

On that evening, Fred and Dolly engaged in a heated argument. Fearing for Dolly's safety, Otto emerged from his attic hideaway armed with two .25 caliber pistols. A struggle ensued between Fred and Otto, resulting in Otto shooting Fred three times, leading to his death. To mislead investigators, Dolly and Otto staged the scene to resemble a botched burglary: Otto locked Dolly inside a closet from the outside and took Fred's diamond watch to make it appear as though a thief had been present.

When police arrived, they found Dolly locked in the closet and Fred deceased. Dolly's account of a burglar locking her away and killing her husband raised suspicions, but without concrete evidence, no immediate charges were filed.

Following Fred's death, Dolly continued her relationship with Otto, who remained hidden in her new residence's attic. She also became involved with her attorney, Herman S. Shapiro, to whom she gifted Fred's diamond watch, claiming she had found it under a cushion.

The case took a turn in 1923 when Dolly's relationship with another lover, Roy Klumb, soured. In retaliation, Klumb informed the police that Dolly had asked him to dispose of a gun, which she claimed resembled the burglar's weapon. This led to Dolly's arrest, but due to insufficient evidence, she was released.

In 1930, after a falling out with Dolly, Shapiro revealed Otto's existence to the authorities. Otto was arrested and charged with murder, while Dolly was charged with conspiracy. Otto was convicted of manslaughter; however, due to the statute of limitations, he was released. Dolly's trial resulted in a hung jury, and eventually, the charges against her were dropped.

Dolly lived the remainder of her life in Los Angeles, marrying her business manager, Ray Bert Hedrick, shortly before her death on April 8, 1961.