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would be warranted to account for the admittedly thin nature of
that secondary market. Regarding his suggested upper limit of 25
percent, Mr. Burns essentially testified that such figure derives
from his attempt “to extricate somehow * * * from the restricted
stock studies” the portion of the observed discount level which,
in his opinion, readily translates to the transferred interests.
Given the lack of quantitative evidence in support of that
attempt, as well as Mr. Burns’s tacit acknowledgment that the
lower limit of his suggested range of discounts is understated,
we are not persuaded by his opinion that the appropriate range of
marketability discounts for the transferred interests is 5 to 25
percent. We are even less impressed by his arbitrary selection
of the midpoint of that range (15 percent) as his suggested
discount.
4. Determination of the Marketability Discount
Having expressed our dissatisfaction with the experts’
respective analyses, we must nevertheless determine an
appropriate marketability discount for the transferred interests.
As noted above, respondent’s expert states in his written report
that a marketability discount above 25 percent would not be
justified for an entity with the characteristics of the
partnership. We treat that statement as a concession that a
marketability discount of up to 25 percent (rather than the
arbitrarily selected 15 percent) would be appropriate for the
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