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The value to FMC of keeping the financial
information confidential until April 2, 1986--allowing
FMC to consummate a recapitalization at $10 per share
less than what eventually proved to be a fair price for
the public shareholders' stock--is not a legitimate and
legally cognizable value for which FMC may seek legal
recourse. FMC's insiders were not privileged to
appropriate confidential corporate information for
their own benefit, and to the detriment of public
shareholders. "Corporate insiders ... have an
obligation to place the shareholder's welfare before
their own...." Chiarella v. United States, 445 U.S.
222, 230, 100 S. Ct. 1108, 1115-16, 63 L. Ed. 2d 348
(1980). [Id. at 633-635 (footnote refs. omitted).4]
A discussion of the value of old FMC stock was also at the heart
of the decision of the Court of Appeals for the Second Circuit in
FMC Corp. v. Boesky, 36 F.3d 255 (2d Cir. 1994), when it affirmed
Judge Pollack’s decision upon appeal. The Court of Appeals for
4 Petitioner argues that Judge Pollack did not find as a
fact that the value of old FMC stock was $97 at the time of the
recapitalization but simply concluded that petitioner did not
provide any admissible evidence to support a lower value. We do
not read this quoted language as narrowly as petitioner. All the
same, the application of collateral estoppel is not precluded
simply because a party such as petitioner did not produce all of
its evidence in the prior case. Cory v. Commissioner, 159 F.2d
391, 392 (3d Cir. 1947), affirming a Memorandum Opinion of this
Court. Evidence which, by due diligence, could have been
produced in the prior case is considered to have been available
at the first case and, to the extent relevant to the issue in
dispute, should have been introduced at the time of the prior
case. See Dean v. Commissioner, 56 T.C. 895, 900 (1971); Milberg
v. Commissioner, 54 T.C. 1562, 1566 (1970). In this regard, we
reject petitioner’s assertions that Judge Pollack made a
conscious effort to prevent it from presenting any evidence as to
the applicable value of the old FMC stock and that he otherwise
minimized the probative value of any such evidence by considering
it irrelevant to the case before him.
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