Santa Monica Pictures, LLC, Perry Lerner, Tax Matters Partner - Page 140

                                        -218-                                         
          however, none of these transactions actually resulted in a                  
          transaction between SMP, SMHC, and the other companies.  Further,           
          although petitioner submitted various exhibits indicating his               
          contacts with the various parties, we have no basis from which to           
          evaluate the content or the scope of the alleged discussions and            
          negotiations.  At best, the Ackerman group’s various attempts to            
          engage in film activities through SMP might be relevant in                  
          determining whether SMP was a bona fide partnership for Federal             
          tax purposes; however, respondent does not dispute that SMP is a            
          bona fide partnership.  These film-related activities are                   
          unrelated to the CDR transaction and do not persuade us that the            
          banks intended to enter a film distribution business with the               
          Ackerman group, as petitioner claims.                                       


               163(...continued)                                                      
          regarding the distribution of SMHC’s films in connection with its           
          cable business; (6) a possible acquisition of the Crossroads film           
          library in 1997; (7) negotiations with Atlas Entertainment in               
          1997 and 1998 regarding the development of a production capacity            
          inside of SMHC; (8) a business proposal to establish an African-            
          American film distribution company with C. O’Neill Brown in 1998;           
          (9) a possible transaction with Reisher Entertainment in 1998;              
          (10) a possible acquisition of the feature film library of the              
          Modern Times Group in 1998; (11) negotiations with Frank Klein,             
          who was president of PEC Israeli Economic Corp. in 1998; (12)               
          negotiations regarding the sale of Polygram Filmed Entertainment            
          in 1998; (13) a possible merger of SMHC with, or acquisition by,            
          Artisan Entertainment in 1998; (14) a possible business venture             
          with Regent Entertainment, Inc. in 1998; (15) negotiations for              
          the purchase of film titles from Silver Screen International and            
          Aries Entertainment, Inc., in 1999; and (16) a possible film deal           
          involving Broadcast.com. in 1999.  Petitioner also points to                
          discussions with Alan Cole Ford, formerly of MGM, regarding his             
          acquisition of Paul Kagan Associates.                                       





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