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renewal, and automatic monthly billing of contributions had been
eliminated.
ABS initially solicited petitioner’s members with respect
to the credit card program in a communication dated June 15, 1986
(the June 15 communication). The June 15 communication contains
letters on Sierra Club stationery, with facsimile signatures by
officers of petitioner, informing members of “a new member
service” and of the benefits both to members and to petitioner
(“royalty fees”). An enclosed brochure invites communication
with ABS and states:
American Bankcard Services, Inc. is an independent
California corporation organized to provide bankcards
to the members of various national Affinity Groups as
a unique member service and fund raising opportunity.
American Bankcard has contracted with the Sierra Club
in order to make Sierra Club VISA cards available to
members of the Club.
Members are instructed to mail their applications to Chase
Lincoln. The June 15 communication was mailed to members using
petitioner’s nonprofit postage permit. ABS paid for the June 15
communication, including the costs of design, printing, business
reply envelopes, postage, and mailing labels.
After a member’s application was accepted, the member
received a letter congratulating the member “for joining with the
Sierra Club and Chase Lincoln First in this important new
program” and stating: “The added income to the club [sic] from
your use of the card will certainly benefit the Club in its
continuing efforts to improve our environment, to keep endangered
species alive and to save the wilderness.” That letter
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