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Prior to 1982, Furlong did not make many investments. In
1981 at Schluter’s suggestion, he did invest in a partnership
called Jacobs and Stewart that was building office buildings.
Furlong considered this investment unsuccessful. His 1979 tax
return also reflects an investment in Glenaire Apartments and in
several investments described as “Gas and Go Ten-Ten Truck Stop”
and “Schmidt and Furlong Gas and Go”. Sometime during 1982,
Schluter told Furlong about Hamilton while they were playing
golf. Subsequently, Schluter and Furlong discussed Hamilton a
number of times, generally during their golfing afternoons, and
as a result of these discussions, Furlong paid $25,000 for his
partnership interest in Hamilton.
Furlong does not have any education or work experience in
the plastics recycling or plastics industries. Moreover, Furlong
did not personally review Hamilton’s offering memorandum or
investigate Hamilton before becoming a participant in the
partnership. Instead, Furlong relied upon Schluter’s advice
about Hamilton. Furlong also contends that Schluter never told
him that he had questions regarding Hamilton’s valuation of the
recyclers. Furthermore, Furlong asserts that he invested in
Hamilton for additional income for his retirement because Furlong
Oil did not have a pension plan. However, Furlong also testified
that he knew that Hamilton was a tax shelter. Schluter told
Furlong that Hamilton was a tax shelter; Furlong knew what a tax
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