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perpetual licenses to exploit, outside the United States, certain
technical information developed (or to be developed) at LAC’s
research facility and certain improvements made (or to be made)
to certain patent rights licensed to LAC by L’Air. On its tax
returns for the years in issue, petitioner characterized the
royalties received from L’Air as section 904(d)(1)(I) general
limitation income for foreign tax credit purposes. On
examination, respondent recharacterized the royalties as section
904(d)(1)(A) passive income. The deficiencies are a result of
this recharacterization.
Discussion
A. Whether Summary Judgment Is Appropriate
Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials. See Northern Ind. Pub.
Serv. Co. & Subs. v. Commissioner, 101 T.C. 294, 295 (1993);
Florida Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988);
Shiosaki v. Commissioner, 61 T.C. 861, 862 (1974). Summary
judgment is appropriate where there is no genuine issue 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); Jacklin v.
Commissioner, 79 T.C. 340, 344 (1982). In deciding whether to
grant summary judgment, the Court must consider the factual
materials and inferences drawn from them in the light most
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