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revg. in part T.C. Memo. 1994-228; Mollen v. United States, 72
AFTR 2d 93-6443, 93-2 USTC par. 50,585 (D. Ariz. 1993); Wright v.
Commissioner, T.C. Memo. 1994-288; Daoust v. Commissioner, T.C.
Memo. 1994-203; Wood v. Commissioner, T.C. Memo. 1991-205; and
Davis v. Commissioner, T.C. Memo. 1989-607.
Petitioners' reliance on the Wright, Daoust, Wood, and Davis
cases is misplaced. The taxpayers in the Wright case had an
objective of making a profit; relied upon an adviser who
expressly recommended the subject investment; reviewed the
offering memorandum; were advised that the investment had already
survived an IRS audit unchanged; and personally monitored the
investment. In the Daoust case, the taxpayer husband relied upon
the advice of two qualified independent investment advisers and
an independent C.P.A., who also was the taxpayer husband's
brother. In the Wood case, a group of consolidated cases, a
financial planner recommended the investment, all of the
taxpayers had profit objectives, the transactions were not sham
transactions, and one taxpayer husband and wife inspected the
equipment at issue. The taxpayers in the Davis case relied in
part upon the express recommendation of a "trusted and long-term
adviser", and in part upon their review of the offering materials
(which did not reflect that the principals in the venture lacked
experience in the pertinent line of business). Davis v.
Commissioner, supra. In contrast to those cases, Bach was not a
trusted and long-term adviser to petitioners but a recently
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