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were seeking to uphold the written terms of their settlement
agreement; Indeck seeks to disregard the written terms to which
it agreed, bringing the principles of Kreider v. Commissioner,
762 F.2d 580 (7th Cir. 1985), into play.
More fundamentally, with respect to Rozpad and Delaney, the
relationship between an appealable verdict and a closely
proximate settlement thereof, as existed in those cases, does not
obtain in Indeck’s case. In Rozpad and Delaney, settlements were
reached during the appeal period for verdicts obtained by the
taxpayers. The settlement agreements did not allocate any
portion of the settlement payments to interest, though the
verdicts had included substantial interest components. In each
case the court sustained the Commissioner’s determination that
the settlement payment contained interest in the same proportion
that the interest awarded in the verdict bore to the total amount
awarded in the verdict, notwithstanding the absence of any
allocation to interest in the written settlement agreement.
The straightforward causal relationship between the verdict
and settlement in Rozpad and Delaney is not present in the
instant case between the arbitrator’s award and the Settlement
Agreement. The Settlement Agreement was prompted by developments
in the Lake County Lawsuit, not the pending appeal of the
arbitrator’s award in the Cook County Lawsuit. The Settlement
Agreement was not a compromise of the arbitrator’s award for a
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