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with the explanation of what the options might be as to the
desirability of accepting any settlement proposal."
On February 6, 1988, Mr. Kersting wrote to Mr. Hallett
stating in pertinent part:
I take it from our phone conversation yesterday that
you are intent now to trigger the melt-down on me and
our corporations with which you have threatened me now
for months. And if I have absorbed all this correctly,
you will do this mainly out of concern that some of my
friends might sue you at some time down the line if you
do not advise them of a "settlement" which you perceive
to be available.
The bitter irony of all this is that there was only a
remote possibility that anyone of my friends would sue
you. If you go through with your threat to cause a run
on us you will have THE CERTAINTY that there will be
litigation. It will be hell after this.
On February 8, 1988, Mr. Kersting wrote a letter to Kersting
program participants warning them that Chicoine and Hallett soon
would circulate the details of a 20-percent settlement offer.
Mr. Kersting urged Kersting program participants not to hire
Chicoine and Hallett for purposes of settlement and instead to
await the Court's decision regarding the evidentiary issues
raised by Chicoine and Hallett on behalf of the test cases.
During this period, Mr. Kersting threatened to sue Chicoine and
Hallett if they reported the settlement offer.
On February 9, 1988, Mr. Chicoine issued two letters, one
addressed to the firm's clients and one addressed to Kersting
program participants who had contacted Chicoine and Hallett
regarding representation. These letters served as status reports
on the Tax Court case and settlement negotiations. Mr. Chicoine
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