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incorporated Mr. Gustavson’s underlying asset values for Belle
Fourche and True Oil, rather than those of Mr. Lax, and reflected
approximately $16 million of debt owed by Belle Fourche that had
not been accounted for previously.
At trial, respondent’s counsel characterized as a
“concession” the position in Exhibit 262-P and the trial
memorandum that allowed minority and marketability discounts.
Both petitioners’ counsel and the Court indicated that they did
not understand exactly how “Current IRS Value[s]” were derived in
all cases. Respondent’s counsel stated that the combined
discounts were different for each company and that the exact
amounts would be fleshed out through further testimony59 and on
brief. Respondent’s counsel also stated that the combined
discounts were less than 40 percent in some cases and that
respondent never intended the 40-percent figure to serve as a
starting point for negotiation.
At trial’s end, respondent’s counsel asserted that “Current
IRS Value[s]” had been put forth as a settlement position only,
in an effort to resolve the case, and that respondent had not
conceded that petitioners were entitled to combined, across-the-
board discounts of no less than 40 percent as to all the disputed
companies. Petitioners’ counsel objected to respondent’s
59However, respondent presented no additional testimony to
explain the derivation of the discounts included in the “Current
IRS Value[s]” figure or the amount of any discounts respondent
was proposing in lieu thereof.
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