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investments.” But neither the 1989 report nor the 1991 report
explains the dramatically higher net income (after taxes) for
years after 1988, as compared to years before. Sixth, the 1991
report refers to the financial data of publicly traded companies,
nominally in similar lines of business, yet never explains how
those companies were selected, or in what respects the lines of
business were similar to Eatel's.12 Although Mr. Chaffe
testified at trial that the publicly traded companies in the 1989
report were “essentially the same“ as the companies used for the
1991 report, he also testified that these companies may have
changed from 1989 “through merger acquisition or something like
that.”
The 1991 report states that the shares of Eatel are not
marketable, yet fails to explain sufficiently why this is so.
Mr. Chaffe testified at trial that “There are very rare
exceptions when there is any willing buyer at all at any price
for minority shares of a nonpublicly-traded company”. This
testimony is unsupported by the record, unpersuasive by itself,
and implausible. We find that the shares were marketable. As a
point of fact, the 1989 report notes that some shares of DATA
12 In this regard, we give little weight to the conclusions
of Mr. Chaffe that: (1) The price-earnings multiples of
comparable publicly traded telecommunications corporations
increased by more than 50 percent between the date of Decedent’s
death and March 1993, and (2) the premiums paid in 1993 for the
stock of publicly traded telecommunications corporations were
more than 52 percent above the prices at which minority blocks
were then trading.
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