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formation. Hyatt Corp. continued to send payments to Weaver
until Kanter notified Hyatt Corp. sometime around 1992.
From 1984 through 1989, Hyatt Corp. paid the following
commissions with respect to the Embarcadero Hotel that were
reported as income of the KWJ Co. partnership:
Operating Year Payment Year Payment
1984 1985 $295,415
1985 1986 330,376
1986 1987 327,784
1987 1988 281,926
1988 1989 75,396
1989 1990 24,340
The KWJ Co. partnership paid Weaver his 30 percent and
deducted the payment as a commission expense.
B. The Frey Arrangement: Condominium Conversions.
Bruce Frey (Frey), was a certified property manager, real
estate broker, and insurance broker. Frey began working at the
real estate firm of Downs, Mohl & Co. in 1965. While at Downs,
Mohl & Co., Frey met Kanter. In the early 1970's, Frey formed
D.M. Interstate, Inc., a real estate management company that was
an S corporation. In 1975, James Wold (Wold), became a
shareholder and employee of D.M. Interstate, Inc. Sometime
later, Frey also formed BJF Development, Inc., a corporation that
engaged in real estate development and management. Frey was the
sole shareholder of BJF Development, Inc. Hereinafter, D.M.
Interstate, Inc. and BJF Development, Inc., are each sometimes
referred to as a Frey corporation.
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