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Commissioner, 50 T.C. 975 (1968) (distinguishing Pennsylvania
law); Petersen v. Commissioner, 38 T.C. 137 (1962) (Nebraska and
South Dakota law); Benci-Woodward v. Commissioner, T.C. Memo.
1998-395 (California law); Sinyard v. Commissioner, T.C. Memo.
1998-364 (Arizona law); Srivastava v. Commissioner, T.C. Memo.
1998-362 (Texas law); Coady v. Commissioner, T.C. Memo. 1998-291
(Alaska law). But see O'Brien v. Commissioner, 38 T.C. 707
(1962) (dictum that State law makes no difference), affd. per
curiam 319 F.2d 532 (3d Cir. 1963).37
Wisconsin law governed the attorney-client relationship
between Fox & Fox and Mr. Kenseth. Wisconsin law arguably gives
attorneys the two unusual interests in their clients' lawsuits
relied on by the majority opinion in Cotnam v. Commissioner, 263
37 Other Federal courts, in concluding that taxpayer-
plaintiffs are taxable on contingent fees paid to their
attorneys, have also noted that the State laws in issue do not
give attorneys proprietary or equitable interests in their
clients’ recoveries or causes of action. See Baylin v. United
States, 43 F.3d 1451, 1455 (Fed. Cir. 1995) (commenting on
Maryland attorney’s lien statute); Estate of Clarks v. United
States, 98-2 USTC par. 50,868, 82 AFTR 2d 7068 (E.D. Mich. 1998)
(distinguishing Cotnam v. Commissioner, supra, on the ground of
differences between Michigan and Alabama law), revd. 202 F.3d 854
(6th Cir. 2000)). My view that the tax effects of contingent fee
agreements should be decided on the broader ground makes it
unnecessary for me to take a position on the view of the Court of
Appeals for the Sixth Circuit that the Michigan common law
attorney’s lien is the equivalent of the proprietary interest of
the attorney in the cause of action under Alabama law.
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