Philip Morris, Inc. v. Commissioner
United States Tax Court
PM is the common parent of an affiliated group of corporations that filed consolidated returns for the years in issue. On June 1, 1978, PM, through NS, its acquisition subsidiary, acquired all the outstanding stock of S, a publicly traded corporation, in a hostile takeover. W-J was a subsidiary of S. On June 16, 1978, NS caused W-J to merge with and into S in a transaction that qualified as a liquidation under secs. 332 and 334(b)(1), I.R.C., as amended.
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PM is the common parent of an affiliated group of corporations that filed consolidated returns for the years in issue. On June 1, 1978, PM, through NS, its acquisition subsidiary, acquired all the outstanding stock of S, a publicly traded corporation, in a hostile takeover. W-J was a subsidiary of S. On June 16, 1978, NS caused W-J to merge with and into S in a transaction that qualified as a liquidation under secs. 332 and 334(b)(1), I.R.C., as amended. On June 19, 1978, NS caused S to merge with and into it pursuant to a liquidation under secs. 332 and 334(b)(2). In allocating NS's refined…
1Opinion of the Court
JACOBS, Judge:
Respondent determined deficiencies in petitioner’s Federal income tax as follows:
TYE Deficiency
12/31/78 $52,056,108
12/31/79 44,316,979
12/31/80 59,024,150
Following concessions, the primary issue for decision is the fair market value of the Seven-Up Co.’s (Seven-Up) intangible assets as of June 19, 1978, the date such company was liquidated into the New Seven-Up Co. (New Seven-Up) pursuant to sections 3322 and 334(b)(2), following the unsolicited acquisition (on June 1, 1978) of all of its stock by New Seven-Up.
We must also decide the propriety of three upward refinements to the…
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