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T.C. 363 (1966), and the companion case of Steinway & Sons v.
Commissioner, 46 T.C. 375 (1966), and, hence, has been referred
to as the “Alstores doctrine”. The Alstores case involved real
property that had been offered for sale for $1 million and was
eventually sold for $750,000 with a rent-free leaseback to the
seller. The Court held that the rent-free lease constituted
additional consideration for the real property. The Alstores
case involves a factual conclusion that additional consideration
was received in the form of a rent-free lease.
Subsequent cases have made similar factual holdings. One
such case involved a trademark and addressed the question of
whether the transfer of the trademark was a sale or a license;
i.e., whether the seller retained sufficient control or ownership
over the trademark to render the interest sold a license rather
than ownership. See Leisure Dynamics, Inc. v. Commissioner, 494
F.2d 1340 (8th Cir. 1974), revg. and remanding T.C. Memo. 1973-
36. Here, respondent contends that petitioners sold the entire
interest in the DHL trademark and retained no ownership interest,
so that the 15-year royalty-free use by DHL was a license back
that represented additional consideration.
Petitioners make several arguments in response to
respondent’s position. These arguments can be summarized as
follows: (1) The form of the transaction reflects that DHL
“reserved” the 15-year rights to use the DHL trademark in the
United States; (2) section 1253(a) superseded the Alstores
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