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Mr. Comey admitted at trial that he had no receipts or
similar evidence relating to Landtrak’s purported activities. At
one moment, Mr. Comey testified that all documents were lost in a
flood or had been destroyed deliberately to preserve the secrecy
of his inventions. At another moment, Mr. Comey testified that
there were no receipts or other documents because all
transactions had been done in cash or in Switzerland (once again
to preserve the secrecy of his inventions). All these
explanations for the absence of documentary evidence of
Landtrak’s purported activities we find incredible.
Other than Mr. Comey’s testimony (and a few documents
prepared and signed solely by Mr. Comey), which we find
incredible, there is no evidence that Landtrak had any business
purpose or conducted any business activity, once Mr. Riopelle’s
ownership ended in February 1988. We also note that as of the
time of trial Landtrak had not filed any Forms 1120, U.S.
Corporation Income Tax Return, for any year after 1987.
Moreover, in 1999 Landtrak informed the State of Wisconsin that
it was an inactive corporation.
In short, petitioners have failed to prove that Landtrak had
any business purpose or engaged in any business activity after
Mr. Riopelle’s ownership ended in February 1988. Accordingly, we
also conclude that even if Mrs. Comey had, in form, transferred
her Capital Fund shares to Landtrak before their sale, the gain
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