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compared Menards’s share of sponsorship benefits to the other
sponsors’ shares, for which records of fees paid were available,
and should have clarified whether Menards’s logo placement
affected the value of benefits received. Respondent also points
out that the Joyce Julius reports, relied on by both experts,
classified Glidden as the primary sponsor.
After reviewing both experts’ reports, we find it necessary
to conduct our own examination of the evidence in the record to
properly determine the value of the sponsorship benefits Menards
received. See Malachinski v. Commissioner, 268 F.3d 497, 505
(7th Cir. 2001), affg. T.C. Memo. 1999-182. Mr. Caponigro’s and
Mr. Agajanian’s reports are helpful to the extent that the
reports provide a range of reasonable sponsorship values, explain
the valuation of television exposure, and list the other
variables that contribute to a sponsorship’s value. However,
both reports lack explanations for important assumptions related
to the experts’ conclusions. For example, neither report
discusses the approximate values of the various sponsorship
benefits Menards received or compares the benefits to those
received by other TMI sponsors. “The persuasiveness of an
expert’s opinion depends largely upon the disclosed facts on
which it is based.” Estate of Davis v. Commissioner, 110 T.C.
530, 538 (1998).
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