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Mr. DeCastro testified that Mr. McWade considered various
elements in negotiating settlements in Kersting cases, including
the level of the taxpayer's participation in the Kersting
programs and whether the taxpayer had escaped liability in other
years by virtue of the expiration of the period of limitations.
Mr. DeCastro denied passing any information to
Messrs. McWade or Sims regarding Mr. Izen's trial strategy or
that he otherwise acted as a "mole" or "plant" for respondent
with respect to the Kersting test cases.
7. Mr. Izen
Mr. Izen was the first witness to testify at the evidentiary
hearing.
Mr. Izen testified that he had several discussions with
Mr. DeCastro, beginning with Mr. Kersting's deposition in October
1988 through the eve of the trial of the test cases, during which
he revealed his trial strategy to Mr. DeCastro. Mr. Izen
testified that he attempted to "enlighten" Mr. DeCastro, who was
openly pessimistic regarding the chances for success in the trial
of the test cases.
Mr. Izen testified that Mr. DeCastro was upset on the eve of
trial of the test cases that all documentation needed to support
the test case petitioners' position had not been made available
to petitioners. Mr. Izen testified that he did not serve a
subpoena on Mr. Kersting before the trial of the test cases
because he had relied upon the subpoena that Mr. McWade had
served on Mr. Kersting.
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