106 T.C. No. 11
UNITED STATES TAX COURT
OHIO FARM BUREAU FEDERATION, INC., Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 18614-93. Filed April 11, 1996.
P, a tax-exempt agricultural organization, engaged
in activities to promote the use of agricultural
cooperatives among farmers. In 1934, P formed L, a
statewide cooperative. In 1949, P and L entered into a
written contract, whereby P agreed to perform
educational and promotional activities on behalf of L
in exchange for a fee. Pursuant to the contract, P
performed activities to promote cooperatives in general
and L specifically.
In 1985, L merged into another cooperative. In
connection with the merger, P and L formally terminated
their contractual relationship pursuant to a written
termination agreement. The termination agreement
contained a nonsponsorship and noncompetition clause,
whereby P agreed not to sponsor or promote a competing
cooperative on an exclusive basis. In consideration
for the nonsponsorship and noncompetition agreement, P
received $2,064,500.
Page: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011