Santa Monica Pictures, LLC, Perry Lerner, Tax Matters Partner - Page 99

                                        -180-                                         
          billion in tax attributes that the Ackerman group acquired in the           
          transaction.                                                                
               In the discussion that follows, we explain in detail the               
          basis for our conclusion that SMHC’s three assets (the EBD film             
          library, the Carolco securities, and the unused NOLs) had no                
          significant value at the time of the transaction in question.               
                    3.  EBD Film Library                                              
               The parties have offered expert witnesses to opine on the              
          value of the EBD film library at the time of the transaction in             
          question.  As explained below, after carefully considering this             
          expert testimony, we conclude that the EBD film library had no              
          significant value at the time of the transaction in question.               
                    a.  Petitioner’s Expert                                           
               Steven L. Wagner is a principal at Deloitte & Touche.  He              
          specializes in business valuation and issues relating to the                
          entertainment industry.  Mr. Wagner is accredited by the                    
          Association for Investment Research and Management as a chartered           
          financial analyst, is an accredited member (business valuation)             
          of the American Society of Appraisers, and has participated in              
          the financial advisory services industry for more than two                  
          decades.                                                                    
               Mr. Wagner submitted an expert report appraising, as of                
          December 11, 1996, the 65 film titles that CLIS contributed to              
          SMHC on December 10, 1996.  His report assumes:  (a) That all the           






Page:  Previous  170  171  172  173  174  175  176  177  178  179  180  181  182  183  184  185  186  187  188  189  Next

Last modified: May 25, 2011