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that one of the components of polyethylene was oil and that
recycling was good for the environment. Philip Yarnell claims he
understood that there was no competition for the Sentinel EPE
recycler. In fact, information published prior to the Plastics
Recycling transactions indicated that several similar machines
already were on the market. These included at least four other
plastics recycling machines available during 1981, ranging in
price from $20,000 to $200,000: Foremost Densilator,
Nelmor/Weiss Densification System (Regenolux), Buss-Condux
Plastcompactor, and Cumberland Granulators. See Provizer v.
Commissioner, T.C. Memo. 1992-177.
Philip Yarnell purportedly did not know whether Bachmann had
any expertise in engineering or plastics. Marvin Yarnell, on the
other hand, knew that Bachmann did not have any such expertise.
Neither Marvin nor Philip Yarnell asked Bachmann to consult
anyone with expertise in the field of plastics or plastics
recycling. Both were aware that the amount of the tax benefits
flowing from Plymouth exceeded their respective investments in
the partnership. Marvin and Philip Yarnell did not independently
investigate Plymouth or any of the representations made in the
offering memorandum. The Yarnells did not have any education or
work experience in plastics recycling or plastics materials.
OPINION
In Provizer v. Commissioner, T.C. Memo. 1992-177, a test
case for the Plastics Recycling group of cases, this Court (1)
found that each Sentinel EPE recycler had a fair market value not
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