-140-
On the basis of the evidence in the record, we have no great
confidence that the appraisal report, as offered, was completed,
or was given to Mr. Lerner, before the closing on the transaction
with CDR. The photocopy of the appraisal report that is in the
record is undated, except for a cover letter from Mr. Kutner to
Mr. Lerner dated December 9, 1996--just 2 days before the closing
of the CDR transaction and after most of the details of the
transaction were already established. The appraisal report
anachronistically refers to the 65 film titles as the “Santa
Monica Holdings, Inc. Film Library” and states that SMHC owns
those 65 film titles; however, the 65 film titles were not
assigned to CLIS or SMHC (from CLIS) until December 10, 1996.98
The appraisal letter also alludes to other information which the
record demonstrates was not apparent on December 9, 1996. For
example, as previously discussed, there is no indication that the
EBD film titles were ever identified to Mr. Lerner (or through
him, to Mr. Kutner) before December 12, 1996. Also, Mr. Kutner’s
cover letter alludes to certain limitations and caveats relating
to the future distribution plans for the library, “which are more
98 The appraisal report states: “The opinions, conclusions,
and estimates of value presented in this report are based, in
part, on assumptions and financial data furnished to me by Santa
Monica Holdings, Inc., which I have assumed to be correct and
current.” Inasmuch as SMHC did not own the 65 film titles before
Dec. 10, 1996, or have any known relationship to those film
titles, Mr. Kutner’s purported reliance on information from SMHC
seems dubious.
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