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Inc. v. Commissioner, 89 T.C. 225, 233 (1987), affd. 862 F.2d 751
(9th Cir. 1988). Petitioner does not cite, and we have not
found, any authority which requires the Court to ignore a
contract that designates a person as the employer of certain
individuals where the totality of the facts and circumstances
surrounding such person, such individuals, and one or more third
persons who use the services of one or more of such individuals
is not inconsistent with such a contract. In Transport Labor I,
petitioner failed to show that the totality of the facts and
circumstances surrounding TLC, each driver-employee, and each
trucking company client was inconsistent with the exclusive lease
agreement under which each such trucking company client used the
services of one or more of such driver-employees.
As an illustration, the exclusive lease agreement provided
in pertinent part that TLC “shall in its absolute discretion,
hire * * * Lessor’s [TLC’s] employees”. Transp. Labor
Contract/Leasing, Inc. & Subs. v. Commissioner, 123 T.C. at 160.
The Court in Transport Labor I found that TLC retained the sole
and absolute authority to hire each driver-employee. Id. at 164.
The record in the instant case established: (1) Before TLC hired
a truck driver as a driver-employee, such truck driver had to
pass TLC’s screening and approval process, which was designed to
determine a truck driver’s fitness to serve as a driver-employee
of TLC; (2) TLC hired approximately 25 percent of its driver-
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