- 41 -
records."
Becker confirmed at trial that he relied on the offering
materials and discussions with PI personnel to establish the
value and purported uniqueness of the recyclers. Becker
testified that he relied upon the reports of Ulanoff and Burstein
contained in the offering materials, despite the fact that: (1)
Ulanoff's report did not contain any hard data to
support his opinion; (2) Ulanoff was not an economics or plastics
expert; (3) Becker did not know whether Burstein was an engineer;
and (4) Burstein was a client of Miller's and was not an
independent expert. In addition, Ulanoff and Burstein each owned
an interest in more than one partnership that owned Sentinel
recyclers as part of the Plastics Recycling Program.
Becker explained at trial that in the course of his practice
when evaluating prospective investments for clients, he focuses
on the economics of the transaction and investigates whether
there is a need or market for the product or service. With
respect to the Partnership transactions, the records indicate
that Becker overlooked several red flags regarding the economic
viability and market for the Sentinel EPE recyclers. The
offering memoranda for the Partnership transactions warned that
there was no established market for the Sentinel EPE recyclers.
Becker never saw any marketing plans for selling the pellets or
leasing the recyclers. He accepted representations by PI
personnel that they would be marketing the recyclers to clients
Page: Previous 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 NextLast modified: May 25, 2011