Joseph S. Rozpad and Kathleen M. Rozpad - Page 7

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          the First Circuit found, on similar facts, that the phrase "no              
          interest" is ambiguous and could mean that there is no interest             
          in addition to the interest implicit in the settlement amount.              
          See also Delaney v. Commissioner, T.C. Memo. 1995-378; Forest v.            
          Commissioner, T.C. Memo. 1995-377, affd. without published                  
          opinion 104 F.3d 348 (1st Cir. 1996).  Second, the stipulations             
          are not part of the settlement and do not relate to the                     
          allocation of settlement proceeds.  They are merely requests for            
          the court to dismiss the respective actions without imposing                
          interest or costs.  Accordingly, a portion of both the Rozpads'             
          and the DiBiasios' settlement is allocable to prejudgment                   
               Respondent determined that a portion of each settlement must           
          be allocated to statutory interest in the same ratio that                   
          statutory interest bore to the total judgment.  The facts and               
          case law support respondent's determination.  Each settlement               
          occurred after petitioners received awards of damages and                   
          prejudgment interest.  In Delaney, 99 F.3d at 25-26, the Court of           
          Appeals affirmed this Court's finding that the prejudgment                  
          interest component of a settlement was in the same proportion as            
          the prejudgment interest that was added to the court's damage               
          award.  See Robinson v. Commissioner, 70 F.3d 34, 38 (5th Cir.              
          1995), affg. in part, revg. in part and remanding in part 102               
          T.C. 116 (1994); see also United States v. Burke, 504 U.S. 229,             

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