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Petitioners rely on these factors to sustain the allocation.
They did not offer an expert witness. Respondent did not discuss
these factors, at trial or on brief, relying instead on the
testimony of an expert witness, Nhoth Chouravong, to establish
the value. Neither party offered any evidence as to the value of
the other intangibles. We first apply the enumerated factors to
the facts of these cases and then turn to Mr. Chouravong's
report.
All the factors, with the possible exception of one, favor a
substantial allocation to the covenant.
(a) The seller's ability to compete. Mr. Langdon certainly
had the ability to compete. Neither his health nor his age was
an impediment, and he was working at full throttle, continuing to
expand the business when it was sold. Respondent argues that,
because of existing exclusive distributorships, the only avenues
open for petitioner were to start from scratch with specialty
beers. But that is not correct: Mr. Langdon could have
purchased Skaar, which was a business in place representing
Pabst, or he could have gone to work for the Budweiser
wholesaler.
(b) The seller's intent to compete. At the time of the
sale, Mr. Langdon did not intend to compete. He believed it
would be unethical to do so, especially during the 2 years of his
consulting contract. However, he could have changed his mind.
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