United States' Motion to Exclude Expert Testimony of Plaintiffs'

WAS BENEFICIAL'S PARTNRSHIP INTEREST IN BPB DESIGNED TO CONCEALTAX LOSSES?Dubinsky asserts that there "appears to have been nobusiness purpose for adding (Beneficial J as a 1% member of BPB."(Dubinsky at 24.)Dubinsky notes that adding Beneficial as amember did not change the terms of the swaps or the economiceffect of the transactions to Beal individually, given that Bealwas 100% owner of Beneficial. Beal represented to Coscia thatthe "primary purpose for admitting Beneficial as a member of BPBwas so that Beneficial could provide management services forBPB. " (Coscia Opinion at 16.) This representation contradictsDubinsky's conclusion, but apparently Dubinsky finds therepresentation incredible.Dubinsky rejects the idea that Beneficial was added as amember of BPB to provide management services, in part on theground that there was no management services agreement betweenBPB and Beneficial. Because Beal owned 100% of Beneficial'sstock it is not clear why he would go to the trouble offormulating the type of formal management services agreement theabsence of which Dubinsky finds significant. Why does Beal needwritten service agreements for arrangements among wholly-ownedenti ties?In this part of his report, Dubinsky is quick to point outthat Beneficial is wholly owned by Beal when he thinks it helps- 15 -____..__....._______.._m._.....,"_._.._.._._.__..._._m__.~~__~_.~___"_. ._.___.._..."..._~__.__...,_.__~,_"__.__.._.__.___._~~..__~._..._.._".__....__.___...________..,,__..~_..__.____.____