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partnership. At the time of trial, Mr. Hulse was deceased;
therefore, the details in this record surrounding his advice to
petitioners about Blythe II are scant. Petitioner provided Mr.
Hulse with a copy of the offering and asked Mr. Hulse to review
the same and advise petitioners whether or not to invest in
Blythe II. Mr. Hulse advised petitioner that, in petitioner's
words, it appeared that "the risk reward justified an investment"
in Blythe II. Mr. Hulse did not provide petitioners with a
written opinion about the investment. The record is devoid of
any evidence to show that Mr. Hulse conducted any independent
research or consulted any type of agricultural or jojoba plant
expert about the investment. The record in this case indicates
that Mr. Hulse relied solely on the representations made in the
offering in rendering his advice to petitioners.
Moreover, the record lacks evidence to show whether Mr.
Hulse had any previous experience with the deductibility of
research and development expenses at the time he advised
petitioners about Blythe II. These types of expenses would have
allowed petitioners certain tax benefits above and beyond what
would have been provided by an ordinary business deduction.
There is no evidence in the record to suggest that Mr. Hulse
conducted any independent investigation to determine whether the
specific research and development proposed to be conducted by or
on behalf of the partnership would have qualified for deductions
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