Martin and Marion Abbene - Page 7

                                                 - 7 -                                                   

            November 1990, the major Hollywood film and television producers                             
            began a boycott against Local 52 of the International Alliance of                            
            Theater Stage Employees and Moving Picture Machine Operators                                 
            (Local 52), which significantly lessened film and television                                 
            production in the New York City metropolitan area.  The boycott                              
            against Local 52 was settled during May 1991.  Neither Blue                                  
            Ribbon nor Mr. Abbene had any further dealings with ABC after the                            
            February 8, 1989, agreement.                                                                 
                  During the years in issue, Blue Ribbon engaged solely in the                           
            activities of horse breeding, horse showing, and providing riding                            
            lessons.  Neither Mr. Abbene nor Blue Ribbon sold any horses                                 
            during the years in issue.                                                                   
                  Nakita and Spectacular Rhythm were maintained for breeding                             
            purposes.  Mr. Abbene hired a veterinary doctor to do all of the                             
            breeding because neither he nor Elena had any veterinary                                     
            training.  Nakita produced no foals, and Spectacular Rhythm                                  
            produced only one foal, Precious Moment.  Precious Moment was                                
            born stunted, during 1991.  Mr. Abbene made no attempt to breed                              
            Spectacular Rhythm after the birth of Precious Moment.                                       
                  Blue Ribbon entered approximately 25 to 30 horse shows each                            
            year during the years in issue.  King Lion, however, was the only                            
            horse shown by Blue Ribbon for prize moneys.9  Aside from $6,500                             

            9     We make this finding notwithstanding Mr. Abbene's testimony                            
            that Nakita was also shown for prize moneys.  The parties                                    
                                                                           (continued...)                




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