Jerry and Patricia A. Dixon, et al - Page 154




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               Mr. Sticht contends that Mr. Izen's representation of test             
          case petitioners does not provide a sound basis for concluding              
          that the Government misconduct did not cause a structural defect            
          in the trial of the test cases.  In particular, Mr. Sticht points           
          to Mr. Kersting's interference in the Chicoine and Hallett                  
          settlement negotiations and his eventual firing of Chicoine and             
          Hallett, and Mr. Izen's alleged lack of preparation for the                 
          trial, as evidence that nontest case petitioners were not                   
          afforded due process.                                                       
          Mr. Kersting, the shelter promoter, had the incentive and                   
          initially the resources to finance the test case litigation.  By            
          so doing, Mr. Kersting positioned himself to influence or                   
          determine the choice of counsel hired to represent the test case            
          petitioners, creating the potential for conflicts of interest.              
          Mr. Kersting repeatedly used his control of the purse strings to            
          interfere in the attorney-client relationships of participants              
          in his programs, as evidenced by his attempts to initiate                   
          Mr. Seery's withdrawal as test case counsel for the Thompsons               
          and his efforts to forestall dissemination to Kersting program              
          participants of Internal Revenue Service settlement offers                  
          solicited by Mr. Seery and by Chicoine and Hallett.  The pattern            
          of interference continued in Mr. Kersting's firing of Chicoine              
          and Hallett as counsel for test case petitioners and encouraging            
          nontest case petitioners to recall their settlement retainers               





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