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doubted that the people at PI could even "talk to [Becker]."
Becker claims that during his visit, he was told that the
recycler was unique and that it was the only machine of its type.
In fact, the Sentinel EPE recycler was not unique. Several
machines capable of densifying low density materials already were
on the market. Other plastics recycling machines available
during 1981 ranged in price from $20,000 to $200,000, including
the Foremost Densilator, Nelmor/Weiss Densification System
(Regenolux), Buss-Condux Plastcompactor, and Cumberland
Granulator. See Provizer v. Commissioner, T.C. Memo. 1992-177.
Becker was also told that PI had put an enormous amount of
research and development--10 to 12 years' worth--into the
creation and production of the Sentinel EPE recycler. When he
asked to see the cost records for some kind of independent
verification, however, his request was denied. Becker was
informed that such information was proprietary and secret, and
that he would just have to take PI's representations as true.
Although PI claimed that all of its information was a trade
secret, and that it never obtained patents on any of its
machines, PI had in fact obtained numerous patents prior to the
recycling transactions and had also applied for a trademark for
the Sentinel recyclers. Becker decided to accept PI's
representations after speaking with Miller (the corporate counsel
to PI), Canno (who had never been to PI's plant or seen a
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