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jojoba, and I–-and that was the primary reason I invested in it.”
Petitioner also contends that he reasonably relied on advice
from a professor at the University of California at Riverside, a
Dr. Yermanos. This individual did not testify at trial, so we do
not know first hand what advice he may have given or on what
basis such advice may have been rendered.21 However, the record
suggests that petitioner never compensated Dr. Yermanos for his
time and that Dr. Yermanos may have merely opined on whether the
jojoba industry as a whole could become profitable.22 There is
nothing in the record to suggest that petitioner ever discussed
the details of San Nicholas with Dr. Yermanos or that Dr.
Yermanos even knew about the existence of that partnership. In
short, petitioner’s testimony concerning Dr. Yermanos is too
amorphous for us to conclude that whatever advice Dr. Yermanos
may have provided was sufficiently informed to absolve petitioner
from liability for the additions to tax for negligence.
Finally, petitioner relies heavily on Krause v.
Commissioner, 99 T.C. 132 (1992), affd. sub nom. Hildebrand v.
Commissioner, 28 F.3d 1024 (10th Cir. 1994). That case, however,
is distinguishable on its facts.
21 We note that no mention is made of a Dr. Yermanos in Utah
Jojoba I Research v. Commissioner, T.C. Memo. 1998-6.
22 Remarkably, Dr. Yermanos apparently admitted to
petitioner that he, i.e., Dr. Yermanos, had not been successful
in convincing anyone to enter the field of jojoba.
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