Abstract

http://ssrn.com/abstract=723261
 


 



The Story of Seagram: The Step Transaction Doctrine on the Rocks


Lawrence Zelenak


Duke University - School of Law


BUSINESS TAX STORIES, Foundation Press, 2005

Abstract:     
This chapter focuses on the Tax Court's 1995 Seagram opinion, which involved the tax consequences of events of 1981 in which Du Pont bested Seagram in a battle for control of Conoco, and Seagram ended up with a 20 percent interest in Du Pont as a consolation prize. Zelenak uses the Seagram litigation to tell two stories - of the development of the step transaction doctrine (a brooding omnipresence in the corporate income tax), and of the intertwined fates of Seagram and three generations of the Bronfman dynasty. In its discussion of the step transaction doctrine, the essay explains the two distinct aspects of the doctrine, and demonstrates the role the doctrine has played (and continues to play) in the evolutionary processes of the corporate income tax. The essay also describes two other tax issues - one involving Seagram's later disposition of its interest in Du Pont, and the other involving Du Pont's later disposition of Conoco - the origins of which trace back to the events of 1981. According to Zelenak, A professor planning a seminar on advanced problems in corporate taxation could do worse than devoting the entire semester to an examination of [the tax issues in the Seagram-Du Pont-Conoco saga].

This paper will be published as a chapter in a book entitled Business Tax Stories, to be published by Foundation Press later this year (2005).

Accepted Paper Series


Not Available For Download

Date posted: May 13, 2005  

Suggested Citation

Zelenak, Lawrence, The Story of Seagram: The Step Transaction Doctrine on the Rocks. BUSINESS TAX STORIES, Foundation Press, 2005. Available at SSRN: http://ssrn.com/abstract=723261

Contact Information

Lawrence A. Zelenak (Contact Author)
Duke University - School of Law ( email )
Box 90360
Duke School of Law
Durham, NC 27708
United States
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