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related to Stewart's clients who subsequently invested in
Sunbelt.
Storey considered contacting an independent engineer for
advice regarding the recycler, but he did not know how or where
to locate someone knowledgeable in plastics. Despite his visits
to Hyannis and review of the offering memorandum, Storey did not
know the names of specific companies that would lease the
recyclers, whether the use of the recycler would be profitable
for any company, or the operating history of the recycler.
Storey spent about 100 hours on an "investigation" of
Sunbelt. He kept track of the time he devoted to this
"investigation" through the use of time sheets and memoranda
regarding his telephone conversations. Storey billed the time
directly related to petitioner's investment in Sunbelt to
petitioner at one rate, and Storey allocated a portion of the
other time, which was general in nature with respect to the
investment, to petitioner at a different rate. Storey believed
he would recoup the expenses related to his "investigation"
through commissions from Sunbelt and the fees he charged clients.
Storey recommended Sunbelt to at least five of his clients
including petitioners. For each investment, Storey was entitled
to receive, and on some occasions did receive, a commission of 10
percent of their investment. Although Storey was entitled to
receive a commission of $5,000 related to petitioners' investment
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