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actions. See, e.g., Ostrom v. Commissioner, 77 T.C. 608 (1981),
in which the taxpayer was allowed to deduct his payment of a jury
award of damages imposed on account of the taxpayer’s fraudulent
misrepresentation on which the plaintiff had relied to his
detriment. To the same effect are the cases described in Ostrom
v. Commissioner, 77 T.C. at 611-613. In the instant case, the
origin and character of the claim from which the liability arose
are petitioner’s personality as a seeker after profit. This is
not affected by whether petitioner won or lost the underlying
litigation or even by whether the California Court imposed the
obligation on petitioner because that Court concluded that
petitioner had acted in bad faith and out of vindictiveness.
The rule is otherwise in certain statutorily defined areas
(see, e.g., Huff v. Commissioner, 80 T.C. 804 (1983), dealing
with sec. 162(f)) and in the “public policy doctrine.” See,
e.g., Commissioner v. Tellier, 383 U.S. 687 (1966). As to what
remains of the public policy doctrine, see the opinions in
Stephens v. Commissioner, 93 T.C. 108 (1989), revd. 905 F.2d 667
(2d Cir. 1990). However, as noted supra note 2, respondent has
conceded the public policy doctrine issue. Also, clearly,
section 162(f) does not apply. Thus, we return to our conclusion
that respondent’s argument about the Payments constituting
sanctions does not change our analysis or conclusions.
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