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sands, like Technology-1980, id. at 143, had no rights to acquire
any oil and gas properties at all, like Barton, id. at 151, or
had options on the Parker Field oil field, like Drake.
Drake’s license of a portfolio of EOR technology with
exorbitant fixed fees and with no knowledge of whether the
technology would be needed, or would even work, was not
consistent with industry standards. Id. at 140, 169. What Drake
did after it licensed the technology does not overcome the
defects present with the original EOR technology license -- the
licensing of EOR technology for grossly exorbitant fees that
establish that the investment was a tax shelter and that the
partnerships lacked a profit objective.
Petitioner alleges that certain findings made in the Krause
opinion are erroneous. The evidence produced at the show cause
hearing, however, does not raise any credible doubt as to the
correctness of the Krause findings of fact.
For example, petitioner challenges the Krause finding that,
in the oil industry, license fees for use of EOR technology were
customarily based only on incremental increased production
attributable to the technology. No evidence, however, was
produced at the show cause hearing to support this claim.
Petitioner alleges that Drake’s attempted reorganization in
1987 would support a finding that Drake was significantly
different from Barton. The partnerships involved in the Krause
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