2
prevailed, exhausted its administrative remedies, and meets the
net worth requirements. Sec. 7430(b)(1), (c)(4)(A)(ii)(I),
(iii). The remaining issues for decision are:
1. Whether respondent’s position in the underlying
proceeding was substantially justified. We hold that it was not;
and
2. whether petitioner's counsel is entitled to be
reimbursed at the rate of $75 per hour plus a cost of living
adjustment, as respondent contends; or at a rate of $125, $150,
and $180 per hour, as petitioner contends. We hold that the
appropriate hourly rate is $103.95 for 1994 and $107.10 for 1995.
The parties submitted memoranda and affidavits supporting
their positions. We decide the motion based on the memoranda and
affidavits provided by the parties. Neither party requested a
hearing. There are no significant factual disputes. We conclude
that a hearing is not necessary to decide this motion. Rule
232(a)(3).
Background
1. Petitioner
Petitioner is a corporation, the principal place of business
of which was in Portland, Oregon, during the years in issue and
when it filed its petition.
2. Underlying Tax Case
The primary issue in the underlying case, Beaver Bolt, Inc.
v. Commissioner, T.C. Memo. 1995-549, filed November 20, 1995,
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