-151-
dispose of their troubled film assets as expeditiously as
possible. At some point, Messrs. Lerner and Jouannet struck a
deal involving a purported acquisition of MGM Group Holdings
(SMHC) and the formation of a limited liability company.
Although petitioner claims that Mr. Jouannet wanted to enter into
a film distribution business with the Ackerman group, the
evidence in the record and the testimony suggest otherwise. In
fact, Mr. Jouannet worked for CDR, which had the assigned task of
liquidating Credit Lyonnais’s losing film assets and loans,
including MGM and MGM Group Holdings. Mr. Jouannet’s goal was to
realize whatever he could, as fast as he could. He was not
interested in any film venture with the Ackerman group. The
banks did not contribute a viable “starter” film library to SMHC,
as petitioner suggests. Instead, what petitioner claims to have
been the cornerstone of a supposed film venture turns out to be
nothing more than a jumble of lackluster film titles. We
conclude that the Ackerman group and the banks did not intend to
partner with one another in any film distribution business.
E. Objective Economic Substance
Under the second factor of the economic substance doctrine,
objective economic substance, we must determine whether the
transaction had any economic significance beyond the creation of
tax benefits. See, e.g., Casebeer v. Commissioner, 909 F.2d at
1365. Our inquiry must consider “‘whether the transaction has
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