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The Court of Appeals for the Ninth Circuit has held in a
different context that 68 percent is not "substantially all" as
that term is used in a predecessor of section 368 relating to
corporate reorganizations. See Pillar Rock Packing Co. v.
Commissioner, 90 F.2d 949 (9th Cir. 1937), affg. 34 B.T.A. 571
(1936).
We leave for another day the exact percentage of employees
that constitutes "substantially all" within the meaning of
section 1.119-1(a)(2)(ii)(e), Income Tax Regs. Petitioners have
not established that even 50 percent of their employees received
qualifying meals. This is not enough to be substantially all.
Given our conclusion that none of the meals of the employees
in question qualify for the section 119 exclusion, we look solely
to the employees conceded by respondent to be within section 119
and determine what percentage of all employees at each Property
they constitute. Respondent's concessions cover the following
numbers of employees:
1987 1988
CHC 450 458
Fremont 427 423
Sam's Town 595 626
Stardust 1,024 1,061
Respondent's concessions translate into the following
percentages:
1987 1988
CHC 44.9 43.5
Fremont 45.6 48.2
Sam's Town 42.4 41.5
Stardust 45.5 44.1
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