Herbst Asset Mgmt. Trust, et al. - Page 25




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          Herbst’s and Mr. Herbst’s respective responses to respondent’s              
          motions to dismiss for lack of prosecution in those cases and               
          (2) section 6673(a)(1), the brief that petitioners filed in these           
          cases on February 15, 2002, contained statements, contentions,              
          and arguments that the Court found to be frivolous and/or ground-           
          less and did not set forth any valid reason why the Court should            
          not dismiss for lack of prosecution the cases at docket Nos.                
          10001-00 and 10002-00.                                                      
               With respect to the accuracy-related penalties under section           
          6662(a) at issue in the cases at docket Nos. 10001-00 and 10002-            
          00, the Court found in Herbst I that respondent satisfied the               
          burden of production that respondent maintained respondent had              
          with respect to those penalties.                                            
               With respect to that part of respondent’s motion to dismiss            
          for lack of prosecution in each of the cases at docket Nos.                 
          10001-00 and 10002-00 asking the Court to impose a penalty under            
          section 6673(a)(1) on petitioner in each of those cases, the                
          Court found in Herbst I that Ms. Herbst and Mr. Herbst instituted           
          the proceedings in those respective cases primarily for delay and           
          that their respective positions in those cases were frivolous               
          and/or groundless.  We held in Herbst I that Ms. Herbst was                 
          liable in the case at docket No. 10001-00 for a penalty under               
          section 6673(a)(1) in the amount of $25,000 and that Mr. Herbst             
          was liable in the case at docket No. 10002-00 for a penalty under           






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