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hired by the Hoyt organization and on other Hoyt investors.
Petitioners, however, have established only that they believed
that the Hoyt organization and the other partners had consulted
with tax professionals. Petitioners have not established in what
manner they personally relied upon any such professionals, or
even the details of what advice the professionals provided that
would be applicable to petitioners’ situation with respect to the
year in issue. Furthermore, because all of these individuals
were affiliated with the Hoyt organization, it would have been
objectively unreasonable for petitioners to rely upon them in
claiming the tax benefits advertised by that very organization.
B. Deception and Fraud by Mr. Hoyt
Petitioners next argue that they should not be liable for
the negligence penalty because they were defrauded and otherwise
deceived by Mr. Hoyt with respect to their investment in the Hoyt
partnerships. In this regard, petitioners first argue that the
doctrine of judicial estoppel bars application of the negligence
penalty because the U.S. Government successfully prosecuted Mr.
Hoyt for, in general terms, defrauding petitioners.
Judicial estoppel is a doctrine that prevents parties in
subsequent judicial proceedings from asserting positions
contradictory to those they previously have affirmatively
persuaded a court to accept. United States ex rel. Am. Bank v.
C.I.T. Constr., Inc., 944 F.2d 253, 258-259 (5th Cir. 1991);
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