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terminated. Pursuant to the new agreement, the three
corporations shared $62.9 million, $85 million, and $94.7 million
of R&D costs for the development of a new generation of disk
drives for 1990, 1991, and 1992, respectively.
In connection with an audit, respondent challenged certain
of the allocations under the cost-sharing agreement. Agreement
was reached with respect to all determined allocations with the
exception of respondent’s determination that the value or cost of
stock options granted to Conner Domestic’s employees had to be
included in the cost-sharing pool. Petitioner contended that
arm’s-length parties would not share the cost, if any, of
employee stock options, and respondent was not aware of any
arm’s-length cost-sharing arrangement where the parties shared
the cost incurred with respect to the grant of an at-the-money
stock option to the employees of one of the parties.
Discussion
Summary judgment is an appropriate means by which to decide
a legal issue if the pleadings, admissions, and other materials,
including affidavits, demonstrate that no genuine issue exists as
to any material fact and a decision may be rendered as a matter
of law. See Rule 121(b); Sundstrand Corp. v. Commissioner, 98
T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th Cir. 1994). Summary
judgment is a device used to expedite litigation, but it is not a
substitute for a trial in that disputes over factual issues are
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