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Eulich-Management and Gateway Corp. From 1982 to 1989, Essex
distributed $788,452 to IRA, $645,028 to Holding Co., $150,899 to
Connolly, and $1,433,551 to Eulich-Management.
IRA accumulated the money paid to it by Essex until 1983.
In 1983, IRA began distributing the money to Ballard, Lisle, and
Kanter through Carlco, TMT, and BWK, Inc., in the 45-45-10 ratio.
On December 31, 1984, IRA transferred its partnership interest in
Essex to Carlco, TMT, and BWK, Inc., in the 45-45-10 ratio. IRA
did not inform the Essex partnership of the transfer and
continued to receive the payments from Essex and then transferred
the payments to Carlco, TMT, and BWK, Inc.
Essex had no real business purpose. It had no office,
equipment, or employees and did not perform any services under
the "Representation and Marketing" agreements with Eulich-
Management and Gateway Corp.
Eulich's relationship with Ballard, Lisle, and Kanter was
longstanding. Lisle's son was employed by one of Eulich's
Vantage companies. The Court is convinced that Eulich agreed
that Eulich-Management would participate in the Essex arrangement
and provide services to Gateway Corp. as payment to Kanter,
Lisle, and Ballard for their influence with respect to other
business directed to Eulich and his corporations. Eulich
testified at trial that he caused Eulich-Management to
participate in the Essex partnership because he expected that
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