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that was filed and the details surrounding the litigation.
Knuckles v. Commissioner, 349 F.2d 610, 613 (10th Cir. 1965),
affg. T.C. Memo. 1964-33; Robinson v. Commissioner, supra at 127.
1. The Parties’ Contentions
Respondent concedes that petitioner satisfies the first
requirement for exclusion under section 104(a)(2). Respondent
contends, however, that petitioner does not satisfy the second
requirement for exclusion because the settlement proceeds were
not received on account of personal physical injury or physical
sickness, regardless of whether “petitioner’s reporting his
suspicions to banking authorities, his termination or the alleged
violation of his procedural and substantive due process rights
gave rise to the recovery of the settlement proceeds”.
Petitioner contends that although the “crux of the cases,
which were settled, was that the Nevada Supreme Court, through
its members, utilized it [sic] power * * * to violate Allum’s
constitutional rights to a fair and impartial tribunal and to
violate the Nevada and Federal Rules of Civil Procedure”, he
received the settlement funds because he had been labeled a RICO
scheme participant by the Nevada Supreme Court and had lost his
FHA underwriting license (license). Petitioner further contends
that because he has a property interest in his license, the
alleged loss of the license constitutes a personal physical
injury for purposes of section 104(a)(2).
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