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the early 1980's to reduce the cost of commencing and engaging in
the farming of jojoba by claiming, inaccurately, that capital
expenditures in jojoba plantations might be treated as research
or experimental expenditures for purposes of claiming deductions
under section 174. Cactus Wren Jojoba, Ltd. v. Commissioner,
T.C. Memo. 1997-504; Glassley v. Commissioner, T.C. Memo. 1996-
206; Stankevich v. Commissioner, T.C. Memo. 1992-458.
Furthermore, in this case, it is questionable whether Utah
I's liability under its R&D agreement with U.S. Agri ever became
fixed. According to its terms, the R&D agreement Utah I entered
into with U.S. Agri on December 31, 1982, expired upon Utah I's
execution of the license agreement.7 Kellen, as general partner
of Utah I, extinguished Utah I's liability under the R&D
agreement by contemporaneously executing the license agreement
with the R&D agreement. As an experienced attorney and bank
executive, Kellen was capable of reading and understanding the
details of the R&D agreement and the license agreement he
executed on behalf of Utah I. Kellen showed a lack of concern
7 Paragraph 11 of the R&D agreement states:
11. Terms of this Agreement
This Agreement shall be effective as of the date
hereof, and shall terminate upon the first to occur of
the following:
a. Upon the execution of the License Agreement
referred to in Paragraph 10.a hereof;
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