Vitamin Village, Inc. - Page 16

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          Helvering v. Natl. Grocery Co., 304 U.S. 282, 295 (1938);                   
          Silverman v. Commissioner, 538 F.2d 927, 933 (2d Cir. 1976),                
          affg. T.C. Memo. 1974-285.  Furthermore, the Court may be                   
          selective in determining what portions of an expert’s opinion, if           
          any, to accept.  Parker v. Commissioner, 86 T.C. 547, 562 (1986).           
               Only respondent offered expert testimony comparing Mr.                 
          Reeves’s compensation with that paid by similar companies for               
          similar services.  Respondent’s proffered expert, Scott D.                  
          Hakala, was a principal and director of CBIZ Valuation Group,               
          Inc., an appraisal, financial advisory, and litigation support              
          firm.  Mr. Hakala has a doctorate in economics, has worked as an            
          economist and financial analyst, and has testified on numerous              
          occasions as an expert in cases involving compensation disputes.            
               Mr. Hakala compared Mr. Reeves’s compensation to chief                 
          executive officer (CEO) compensation in five publicly traded                
          companies (guideline companies).17  He used four methods to make            
          the comparison:  (1) The average compensation paid to the CEOs              
          from the guideline companies; (2) a regression analysis based               
          upon the guideline companies’ relationship between CEO                      
          compensation and their respective sales;18 (3) a guideline                  

               17 Mr. Hakala stated in his report and testified at trial              
          that he used the guideline companies because some or most of                
          their operations were based in the development and marketing of             
          nutritional products.                                                       
               18 The regression equation for 1995 was Y = 315653.0283 +              

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