United States' Motion to Exclude Expert Testimony of Plaintiffs'

made in Australian dollars, for the 95-96% of Solution 6 thatBeal, Montgomery, and related entities did not already own, fora price in the hundreds of millions of dollars. (MontgomeryDeposition at 168:10-21, 170:4-7, 204:14-205:25; Beal Depositionat 194: 14-22.) Montgomery explained in his deposition that hewas basically unconcerned with the (much smaller) currency riskimplici t in ownership of the 4-5% of Solution 6 that was onceowned by Beal Financial Corporation, and that, in any event,hedging such a small risk would not make sense given the costsof execution. (Montgomery Deposition at 171: 10-172: 3.)It is not clear, therefore, why Dubinsky finds significantthe absence of a hedge during the three-and-one-half months BealFinancial Corporation held a 4-5% stake in Solution 6.(Dubinsky at 29.) Dubinsky is correct that there was no hedgeduring this period, but neither was there any seriousconsideration of a tender offer, which was the reason for thehedge. Once again, Dubins ky misses the point.SHOULD THE STEP-TRSACTION DOCTRINE BE APPLIED?Disclaiming any intention to offer legal analysis, Dubinskyoffers a brief primer on the step-transaction doctrine.(Dubinsky at 27.) Dubinsky then muses that if the transactionsundertaken by Beal and Dubinsky had been effected in a differentorder, the tax consequences would have been less favorable.- 20 -