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benefit of the petitioner on account of a highly personal,
emotionally charged familial dispute."
We believe respondent misapplies Gilmore. Petitioner and
William had been business partners. Their dispute, and William's
claims, arose from the terms and circumstances of William's
buyout and, to a certain extent, petitioner's treatment of him in
the workplace. We believe that all of the claims concerned
actions by petitioner in his capacity as a shareholder, officer,
or employee of Lakeview, or in the workplace. In our view, these
claims had their origin in "income-producing activities" as that
term was used in Gilmore to distinguish the origins of deductible
business expenses from those of nondeductible personal ones.
That the litigants were father and son, and their dispute heavily
infused with familial emotions, does not make the attendant legal
expenses "personal" within the meaning of Gilmore. Had Mr.
Gilmore's wife also been his business partner, and sought a
portion of the automobile dealership stock on that basis, the
Court may well have reached a different result. Cf. Kornhauser
v. United States, 276 U.S. 145 (1928) (legal expenses of taxpayer
in defending against claim of former business partner that fees
paid to taxpayer were for services rendered during partnership,
held deductible).
Moreover, we believe that the return of his Lakeview stock
was the most significant relief sought by William, given its
value in relation to the other relief sought. That stock had
been redeemed by Lakeview, not purchased by petitioner.
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