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hours a week to Ascension’s activities, and regularly consulted
with Arabian horse experts relating to Ascension’s operations.
Mr. Routon kept Ascension’s books and records, purchased
insurance, attended seminars, and occasionally showed the horses
at expositions and competitions. He immersed himself in the
Arabian horse industry, taking various leadership positions in
trade organizations and writing columns for industry magazines.
Mrs. Routon searched for suitable horse breeding and farming
properties and tended to the horses when Mr. Routon was
unavailable. Ascension’s horses were handled by a professional
trainer. Expenses relating to Ascension and ALD were billed to,
and paid out of, the same account. At the end of each year, Mr.
Routon would summarize the expenses relating to both businesses.
Mr. Routon promoted Ascension by conducting seminars; mailing
video tapes featuring their top stallion, Diamond Bask, to
seminar attendees; advertising in trade magazines; and attending
exhibitions.
Petitioners’ horses have substantial value. Diamond Bask,
their top stallion, is worth $250,000. Despite the quality of
their horses, petitioners’ sales and marketing endeavors were
ineffective. From 1988 through the years in issue, Ascension’s
cumulative income and expenses were $15,575 and $531,964,
respectively. During this period, petitioners did not have a
profitable year but made several operational adjustments to
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Last modified: May 25, 2011