Jacob and Chana Pinson, et al. - Page 41




                                       - 41 -                                         
          Specifically, respondent maintains that DPC in substance                    
          continued to render services to FIL under the 1980 assistance               
          agreement, and that the letter of July 1990 formally terminating            
          the agreement should be disregarded.  Respondent also relies                
          heavily on the presence and activities of B. Mayer Zeiler in                
          Israel to show that DPC continued to perform the services called            
          for in the 1980 agreement.                                                  
               We believe, however, that the record in this case                      
          establishes the lack of a formal consulting relationship between            
          DPC and FIL.  To the extent that the individual petitioners                 
          advised FIL, the evidence suggests that they did so informally,             
          on behalf of the Deitsch family, rather than specifically in                
          their capacities as employees of DPC.  We base this conclusion on           
          documentary evidence regarding the sales pattern of FIL and the             
          services detailed in the 1980 agreement, as well as on the                  
          testimony of petitioners concerning the mode of business                    
          operation of the Deitsch family and entities.                               
               Stipulated sales figures for years 1978 through 1994 reveal            
          that of FIL’s total sales of $61,679,752 during the 1991 to 1994            
          period at issue, only $39,856 was derived from sales in the                 
          United States and Canada.  Moreover, this trend wherein North               
          American sales accounted for a very small percentage of FIL’s               
          sales volume was established in the mid-1980’s.  Yet under the              
          1980 agreement, two of the five enumerated services to be                   






Page:  Previous  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  46  47  48  49  50  Next

Last modified: May 25, 2011