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The integrated transaction approach is a legitimate "weak"
version of the step-transaction doctrine, as contrasted with the
"strong" requirements8 that must be satisfied, under its binding
commitment and interdependence versions, in order to disregard
unnecessary intermediate steps.9 The creation of and drop-down
to LOF Glass were necessary to accomplish the divestiture
(separating LOF Glass, the new holder of the glass business and
its section 38 assets, from the affiliated group), which was the
intended end result that followed the initial step. The
intention to effect that end result suffices to justify
application of the integrated transaction approach to conclude
that the section 38 assets left the economic family of
petitioner's affiliated group in a way that requires ITC
recapture.
JACOBS, J., agrees with this dissent.
8 The terms "weak" and "strong" are used here in the
mathematical sense of "subject to less/more exacting or numerous
conditions". See Oxford English Dictionary, Entries under
"weak", 19.f(b) and "strong", 19.c (2d ed. 1995). Analogous
usages occur in logic, physics, and cosmology. On "weakened" and
"strengthened" moods of the syllogism, see Cohen & Nagel, An
Introduction to Logic and Scientific Method 84, 86 (1934). On
the "strong" force in elementary particle physics, which holds
the nucleus together, and the "weak" force, which causes the
decay of many of the elementary particles, see, e.g., 28
Encyclopedia Britannica, Subatomic Particles 239-240 (15th ed.
1993). On the "weak" and "strong" anthropic principles regarding
the state of the universe, see Hawking, A Brief History of Time
124-126 (1988). See also Penrose, The Emperor's New Mind 17-23
(1989), on "strong" artificial intelligence.
9 As in West Coast Mktg. Corp. v. Commissioner, 46 T.C. 32
(1966).
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