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satisfaction with tax benefits of expensing their
investments, which were clear to them from the
promoter’s presentation. They passed the offering
circular by their accountants for a “glance” * * *.
The record in the present case suggests that whatever advice Mr.
Kellen may have given was nothing more than a generalized
affirmation to invest in jojoba. Indeed, at trial, petitioner
testified as follows:
Bill was probably a major influence on our investment
with jojoba. You know, Bill was very excited about it
and, you know, he talked to us like a Dutch uncle, you
might say. He was very, very high on the jojoba
investment.
Petitioners also contend that petitioner reasonably relied on
advice from Mr. Pace. The short answer to this contention is that
at no time relevant to this case did petitioner ever meet Mr.
Pace. But if what petitioners mean is that petitioner relied on a
videotape in which Mr. Pace appeared, see supra note 15, then
suffice it to say that reliance on a promotional videotape
produced by the sole contractor (here, U.S. Agri) of the promoter
does not constitute due care, see, e.g., Addington v.
Commissioner, 205 F.3d at 59 (“It is unreasonable for taxpayers to
rely on the advice of someone who they know has a conflict of
interest.”).
Petitioners also contend that petitioner reasonably relied on
advice from a professor at the University of California at
Riverside, a Dr. Yermanos, an individual whom petitioners regard
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