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plastics recycling industry, and he had, at most, only limited
experience in marketing recycling or similar equipment.
Petitioner’s brother had no specialized knowledge of the plastics
recycling industry, and he had no expertise in appraising either
the value of property in general or plastics recycling machines
in particular. Petitioner did not know whether his brother had
any knowledge regarding the value of the Sentinel EPS recyclers,
nor did petitioner know whether his brother talked to anyone in
the plastics industry before giving him “advice”. Petitioner
also did not know whether his brother read the offering
memorandum.
At the time that petitioner signed the subscription
agreement and invested in Whitman, petitioner did not have any
education or work experience in either plastics materials or
plastics recycling, nor did petitioner have any specialized
knowledge about either the plastics industry in general or the
Sentinel EPS recycler in particular.
In contrast, at the time that he signed the subscription
agreement, petitioner knew that his investment in Whitman offered
immediate tax benefits in excess of his $15,000 investment.
Petitioner had not previously made any investment that offered
immediate tax benefits in excess of his investment. Petitioner
was influenced to invest in Whitman by the tax benefits described
in the offering memorandum and the statements made by Winer
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