Robert & Diane Schwartz - Page 10




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               Petitioners were able to receive only one sponsorship from a           
          Japanese company through the Association, which soon after                  
          disbanded in 1993.  Petitioners expected to receive sponsorships            
          from pharmaceutical companies because of Mr. Schwartz’s                     
          profession; however, Congressional investigations of these                  
          companies deterred any sponsorships.  At this point, petitioners            
          began to focus their efforts on chartering the Diane.                       
               During the years in issue, Mr. Schwartz had triple bypass              
          heart surgery and was not aboard the Diane as often as in prior             
          years.  Petitioners also experienced financial pressure during              
          the years in issue because they supported their children’s                  
          graduate educations and were also subjected to malpractice                  
          lawsuits.  Further, petitioners had lost $300,000 in savings                
          because of activities by their pension plan administrator, who              
          was indicted and went to jail because of his illegal activities             
          with other pension plans.                                                   
               During the years in issue, petitioners tried to increase               
          profitability and to cut the Diane’s costs by dismissing its                
          full-time paid captain, hiring crew only when needed, racing in             
          local races to lower the Diane’s transportation costs, moving               
          equipment containers to a free storage location, leaving the mast           
          in for the winter, refinancing the Diane, and having the Diane              
          reappraised to lower insurance rates.  They also sold some of the           
          sails that were not needed and placed more advertisements for               






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Last modified: May 25, 2011