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plan model only 20 percent under the income approach, despite the
admonitions of management that the operations plan projections
were only what could be created in a perfect environment while
the management plan forecasted realistic, achievable targets.
In addition, Dr. Hakala did not use a dividend-based method
under the income approach, although the record reflects that
periodic dividends were the primary means of obtaining a return
on Kohler stock due to the privately held nature of the company.
When asked why he did not use the dividend method at trial, Dr.
Hakala argued first that the DCF analysis made other income
approaches redundant and then stated that dividend-based methods
were unreliable. We are concerned by Dr. Hakala’s choice to
ignore any dividend-based method for Kohler, a privately owned
company that periodically and historically has paid large
dividends as a return to its shareholders, recognizing that no
ready market exists for a shareholder wishing to sell.
We found after the estate’s case in chief that respondent
has the burden to prove that the value of the Kohler stock on the
estate’s return was incorrect. After carefully reviewing and
considering all of the evidence, we continue to find Dr. Hakala’s
conclusions to be incredible. We therefore give no weight to
respondent’s expert’s conclusions. Respondent has therefore not
met his burden of proof. Accordingly, we find the value of the
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