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of Lakeview's employees, petitioner's periods of silence, and
petitioner's willful absence from the business premises. As
relief, William sought rescission of the Redemption Agreement and
return of his Lakeview stock and interest in the Fence Property,
appointment of a receiver and an accounting, consequential
damages stemming from his loss of income from Lakeview and his
income tax liabilities incident to the disposition of his stock
and real property, and damages for intentional infliction of
emotional distress.
Based on our review of the pleadings in the lawsuit and
other evidence in the record, we believe that William's principal
claims in the litigation were for the return of his Lakeview
stock and the Fence Property. The other damages sought by him
were largely derivative, designed either to preserve the status
quo ante (such as the accounting and appointment of a receiver),
or to compensate him for consequential losses resulting from the
stock redemption and sale of the Fence Property, or to punish the
defendants for wrongful acts that led to or were connected with
his decision to enter the Redemption Agreement (e.g., punitive
damages or damages for intentional infliction of emotional
distress).
Respondent argues that under United States v. Gilmore,
supra, the legal fees are nondeductible personal expenditures
because "The origin of the lawsuit, and of its defense by the
petitioner, was the breakdown of a father-son relationship" and
that "these fees were incurred primarily for the individual
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