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section 1504(a)(1). Respondent contends that although in
the vast majority of cases applying section 1504(a),
voting power can and should be measured by reference to
the election of directors * * *, in an aggressively
structured transaction like the instant case, election
of directors is not an appropriate measure of voting
power. In such a case, the Service will look beyond
the election of directors to determine voting power.
Respondent argues that "all judicial and administrative
authorities" that have construed the meaning of the terms "voting
stock" and/or "voting power" for purposes of section 1504(a) and
its predecessor provisions in the Internal Revenue laws support
respondent's position in the present case. According to respon-
dent, those cases and rulings "disavow [petitioners'] * * *
purely mechanical test as the proper standard for voting power
under section 1504(a)." While acknowledging that the pertinent
case law and rulings require the Court in the present case to
consider the right of the Alumax class C common stock to elect
the class C directors and the voting power of those directors in
resolving the issue presented under section 1504(a)(1), respon-
dent contends that those cases and rulings also permit us in the
instant case to examine the voting power of the class C directors
on all board matters, not, as petitioners urge, just on those
board matters on which the directors were to vote in the aggre-
gate, and not by class. Respondent further contends that we must
also consider the impact of the class voting required by the
Alumax stockholders on the same restricted matters on which the
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