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petitioner’s interest in the previous litigation was identical to
Anthony’s.
The controlling case law clearly holds that a corporation is
not collaterally estopped by a prior adjudication involving a
shareholder in these circumstances. The corporation is entitled
to be heard on the question of whether any part of its
underpayment was due to fraud. It is clear that, as a matter of
law, respondent is not entitled to rely on the doctrine of
collateral estoppel to prove that petitioner (1) understated its
income for 1990 and (2) such understatement was due to
negligence.
We conclude that respondent has not shown that there is no
genuine issue as to any material fact with respect to petitioner.
We hold that respondent’s motion for partial summary judgment is
denied.
An appropriate order
denying respondent’s
motion for summary
judgment will be issued.
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