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Petitioner is an orthopedic surgeon who has practiced in the
Las Vegas, Nevada, area since 1974. Through a physician friend
with whom petitioner had been a medical resident in Salt Lake
City, Utah, petitioner became acquainted with a financial adviser
named Gary Sheets (Mr. Sheets). During 1982, Mr. Sheets
approached petitioner about investing in Blythe II, which was
being promoted as an agricultural research and development
partnership. Mr. Sheets provided petitioner with a fairly
voluminous private placement memorandum3 (the offering), which
described the proposed investment in and the activities to be
conducted through Blythe II. Petitioner admittedly did not read
the document. Instead, petitioner passed along the offering to
his accountant, Jack Meyers (Mr. Meyers), who routinely prepared
petitioners' Federal income tax returns. After perusing the
offering, Mr. Meyers advised petitioner that the Blythe II
investment did not appear to be any type of scam.
Petitioner also visited the women's cosmetics aisle in a
local supermarket where he confirmed, as the Court understands
his testimony, that a few women's cosmetic products did contain
some derivative of the jojoba plant. According to the offering,
some hair oils, shampoos, and soap already contained a derivative
of the jojoba plant, and one of the potential new uses for an oil
3 The private placement memorandum consisted of some 47
pages, plus 8 exhibits, and a table of contents.
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