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Development Corp. Mr. Trimboli had no experience in farming or
in research and development ventures, and he was aware that Mr.
Cole, the general partner, also had no experience with respect to
jojoba. Prior to leaving Bugni, LaBanca & Paduano in 1983, Mr.
Trimboli had no experience as a financial planner.
After Mr. Trimboli opened his own business in 1983 and began
offering financial planning services, he and petitioner discussed
various investment strategies. In December 1983, Mr. Trimboli
advised petitioner that he should invest in Arid Land. As a part
of their discussion regarding this investment opportunity,
petitioner was told of certain tax benefits that the partnership
hoped to gain for its investors, and petitioner was convinced
there was nothing improper with the tax strategy.
A private placement memorandum for investments in the
partnership, dated December 1, 1983, was distributed to
petitioners. Prefatory material in the memorandum contained the
following caveats:
PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO CONSTRUE
THIS MEMORANDUM OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS AS
CONSTITUTING LEGAL OR TAX ADVICE. * * * INVESTORS ARE URGED
TO CONSULT THEIR OWN COUNSEL AS TO ALL MATTERS CONCERNING
THIS INVESTMENT.
* * * * * * *
NO REPRESENTATIONS OR WARRANTIES OF ANY KIND ARE
INTENDED OR SHOULD BE INFERRED WITH RESPECT TO THE ECONOMIC
RETURN OR TAX ADVANTAGES WHICH MAY ACCRUE TO THE INVESTORS
IN THE UNITS.
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