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reorganization because it is neither a reverse triangular merger
nor a “B” reorganization, the Mosby transaction also fails to
qualify as a tax-free reorganization. On September 27, 2005, the
Court issued the Bender opinion, in which it found that the
Bender transaction does not qualify as a tax-free reorganization
within the meaning of section 368(a), because it was neither a
reverse triangular merger nor a “B” reorganization.
The parties agree that the Bender opinion governs the
outcome of the Mosby issue at the trial level. They agree that
any judicial determinations affecting the Bender opinion on
appeal or remand will also apply to the Mosby transaction.
Times Mirror’s adjusted basis in its Mosby stock as of
October 9, 1998, was $166,307,272, which amount is greater than
the amount determined in the statutory notice of deficiency,
$161,290,641. Times Mirror realized $415,000,000 in 1998 on the
exchange of its 100-percent common stock interest in Mosby, and
the additional capital gain resulting from Times Mirror’s
disposition of the Mosby stock is $248,692,728.
Discussion
The parties have stipulated that, in accordance with the
Bender opinion and their stipulations and agreement, the Court
should find that the Mosby transaction does not qualify as a tax-
free reorganization within the meaning of section 368(a). This
agreement avoids unnecessary time at trial and facilitates early
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Last modified: May 25, 2011