Dale H. Sundby and Edith Littlefield Sundby - Page 14

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          contradicted by the documentary evidence in the record.  See                
          Niedringhaus v. Commissioner, 99 T.C. 202, 212 (1992).                      
               In their brief, petitioners argue that Navis was just one of           
          many “ventures” operated by petitioner, and that Navis “remained            
          dormant and was only used for interacting with potential                    
          partners”, with the purpose of being available as a corporate               
          entity for any one of petitioner’s ventures should the need                 
          arise.  However, the documentary evidence demonstrates that the             
          correspondence that was sent and received under Navis’s name                
          refers to various products or proposals offered by Navis; these             
          products or proposals have the same names as what petitioners               
          assert were separate business ventures.  We conclude that Navis             
          itself was offering these products or proposals as a part of its            
          business activities.  Petitioners further argue:                            
               Despite respondent’s contention * * * that petitioner                  
               “states, however, that Navis was nothing more than a ‘shell            
               corporation,’ and was not a separate entity from Dale                  
               Sundby, sole proprietor,” petitioner never made that                   
               statement.  In fact, petitioner stated the opposite, that he           
               was CEO of Navis, a separate entity from the sole                      
               proprietorship.  As CEO of Navis, it was not inappropriate             
               for the petitioner to hold himself out as such.  Using Navis           
               provided for legitimacy in signing agreements with other               
               corporations.  Petitioner had no obligation to disclose to             
               any of these parties that Navis had not yet received a                 
               transfer of any intellectual property * * * from the sole              
               proprietorship, had no checking account, etc.                          
          Because we have found that Navis rather than petitioner was                 
          carrying on the trade or business, petitioners’ distinction is              
          one without a difference.  If petitioners argue that Navis was a            

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