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Madison investment. Petitioner also sought out other Madison
partners and contacted approximately 30 companies to assess the
relevant market. Additionally, petitioner contacted PI regarding
the investment, went to look at the recyclers, proposed changes
to Madison’s original business plan, and spent approximately 2
months attempting to have the recyclers at PI placed with end
users. However, petitioner discontinued his efforts to resurrect
Madison because PI was uncooperative.
The Partnership Litigation
On May 17, 1988, a partner other than Madison’s tax matters
partner filed a petition in this Court (docket No. 10601-88) to
challenge the determinations made in the FPAA. On April 9, 2001,
we filed an opinion in docket No. 10601-88, see Madison Recycling
Associates v. Commissioner, T.C. Memo. 2001-85, affd. 295 F.3d
280 (2d Cir. 2002), holding that Madison was a partnership
subject to the provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA), Pub. L. 97-248, sec. 402(a),
96 Stat. 648, and that the period of limitations on assessment
had not expired before the FPAA was issued.16 The opinion was
affirmed on appeal, and our decision sustaining respondent’s
partnership adjustments became final on October 7, 2002.
16By the time we issued our opinion in Madison Recycling
Associates v. Commissioner, T.C. Memo. 2001-85, affd. 295 F.3d
280 (2d Cir. 2002), the parties to the decision had agreed that
respondent’s adjustments in the FPAA were correct.
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