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transferred to them, thereby reducing their transferee
liabilities to zero.
1. Res Judicata
Under the general rule of res judicata, “when a court of
competent jurisdiction has entered a final judgment on the merits
of a cause of action, the parties to the suit and their privies
are thereafter bound ‘not only as to every matter which was
offered and received to sustain or defeat the claim or demand,
but as to any other admissible matter which might have been
offered for that purpose.’” Commissioner v. Sunnen, 333 U.S.
591, 597 (1948) (quoting Cromwell v. County of Sac, 94 U.S. 351,
352 (1876)).
The stipulated decision that this Court entered in each
petitioner’s transferee liability case was res judicata for
purposes of determining each petitioner’s transferee liability.
See Baptiste v. Commissioner, 29 F.3d 433, 436-437 (8th Cir.
1994), affg. in part and revg. in part 100 T.C. 252 (1993);
Krueger v. Commissioner, 48 T.C. 824 (1967). These stipulated
decisions preclude petitioners from relitigating their transferee
liabilities in this collection proceeding. See Katz v.
Commissioner, 115 T.C. 329, 340 n.16 (2000); Gunderson v.
Commissioner, T.C. Memo. 2002-26.
Petitioners argue that res judicata is inapplicable here
because the stipulated decisions in the transferee liability
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