Tygart Valley Glass Co. v. Commissioner
United States Tax Court
In 1936 petitioner in settlement of litigation brought by Hartford for infringement of patents surrendered certain patents, equipment, and cash to Hartford and agreed to pay royalties to Hartford as licensee of such property. In 1939 action was filed by the United States against Hartford for violation of the anti-trust laws. A receiver was appointed and royalties payable from 1942 from petitioner and many other licensees from Hartford were impounded.
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In 1936 petitioner in settlement of litigation brought by Hartford for infringement of patents surrendered certain patents, equipment, and cash to Hartford and agreed to pay royalties to Hartford as licensee of such property. In 1939 action was filed by the United States against Hartford for violation of the anti-trust laws. A receiver was appointed and royalties payable from 1942 from petitioner and many other licensees from Hartford were impounded. In the course of the litigation evidence indicated that petitioner's settlement with Hartford in 1936 was induced by fraud. In 1945 the…
1Opinion of the Court
■OPINION.
Disney, Judge:
The only question for our determination is whether the amount of $241,973.34 received by petitioner on or about November 23, 1945, under a settlement agreement is taxable as ordinary income or as a long term capital gain. The petitioner alleges that the sole claim that it asserted against Hartford in 1945 was a claim based upon the fraudulent taking of its cash and assets by Hartford in 1936 (hereinafter sometimes referred to as the fraud claim), and that the amount of $241,973.34 received in the settlement with Hartford constituted a return of capital and consideration…
2Cases cited6 opinions
- Hartford-Empire Co. v. United StatesSupreme Court of the United States · 1945
- Raytheon Production Corp. v. Commissioner of Int. Rev.Court of Appeals for the First Circuit · 1944
- Helvering v. Safe Deposit & Trust Co. of BaltimoreSupreme Court of the United States · 1942
- United States v. Hartford-Empire Co.District Court, N.D. Ohio · 1942
- Hartford-Empire Co. v. United StatesSupreme Court of the United States · 1945
1 more not listed; retrieve them via the Exa API.
3Cited by12 opinions
- Seay v. CommissionerUnited States Tax Court · 1972
- Fono v. CommissionerUnited States Tax Court · 1982
- Messer v. CommissionerUnited States Tax Court · 1969
- Victor E. Gidwitz Family Trust v. CommissionerUnited States Tax Court · 1974
- McKim v. CommissionerUnited States Tax Court · 1980
7 more not listed; retrieve them via the Exa API.