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court proceedings. Respondent contends, however: (1) Petitioner
has failed to establish that he meets the net worth requirements
of 28 U.S.C. sec. 2412(d)(2)(B); (2) petitioner’s claimed
attorney’s fees are not reasonable; (3) petitioner has failed to
substantiate his litigation costs; and (4) petitioner should not
be treated as the prevailing party because respondent’s position
was substantially justified. Respondent also contends that
petitioner is not entitled to recover litigation costs and
attorney’s fees because petitioner recovered approximately $2.5
million in damages from his former accountant, Mr. Pearce, who
failed to advise petitioner of the section 475(f) election.
Respondent contends that an award of costs and fees in the
instant case is tantamount to an award of punitive damages
against respondent because the $2.5 million that petitioner
recovered from Mr. Pearce far exceeds the litigation costs and
fees sought by petitioner.2 Because we hold, for reasons stated
below, that respondent’s position was substantially justified, we
do not need to address the other issues remaining with respect to
the instant motion.3
2We note that, in 2003, petitioner settled his claim against
Mr. Pearce for failing to advise petitioner about the
availability of the sec. 475(f) election for approximately $2.5
million. Petitioner also settled a claim against one of the
brokerage houses that liquidated petitioner’s trading account for
$1.75 million.
3Although we do not decide whether petitioner meets the $2
(continued...)
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