It is suggested that the reason Dirty Dan and Pinhead Larry are criminals is tax evasion. Pinhead Larry was played by Patrick when he and SpongeBob are playing a game.
Sandy references him in a dream during hibernation as a Texas outlaw, before SpongeBob and Patrick create a game where they fight over the titles of Pinhead Larry and Dirty Dan. During this fight, Sandy confronts them while sleepwalking and asks who the real Dirty Dan is.
Pinhead Larry is one of the most popular SpongeBob SquarePants memes and quotes on the Internet. Dirty Dan is also a considerable meme, but Pinhead Larry is much more popular.