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claims and the counterclaim that have been asserted in * * *
[the] arbitration are hereby dismissed with prejudice and without
costs to either party”; Nomura agreed to pay petitioner
$1,900,000, “less appropriate withholding for income, social
security and other taxes * * * in full satisfaction for the
resolution of the Settled Claims.” Nomura also agreed to donate,
in the name of petitioner’s son, $50,000 to the Children’s Cancer
Research Fund and $50,000 to the Children’s Cancer Research
Program. In consideration of the settlement payment, petitioner
released Nomura from liability for all existing claims (including
the legal fees) and from a litany of other claims, both known and
unknown, that petitioner might assert against Nomura in the
future, including but not limited to indemnification of legal
fees not yet incurred (the so-called “Settled Claims”). The
settlement agreement does not allocate any portion of the
settlement payment to petitioner’s legal fees or, in fact, to any
of the claims asserted by petitioner in the arbitration
proceeding.
Nomura’s Tax Reporting
Nomura issued to petitioner a 1998 Form W-2, Wage and Tax
Statement, which reported as wages subject to tax withholding the
$1.9 million cash payment made to petitioner pursuant to the
settlement agreement.
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Last modified: May 25, 2011