Ernest L. and Kathleen Newsome - Page 5

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                  When petitioner picked up the newspapers from the Star                               
            Telegram for delivery, a "draw" sheet was attached to the bundles                          
            of newspapers indicating the number of newspapers to be                                    
            delivered.  A "draw" is the number of newspapers petitioner                                
            received from the Star Telegram for delivery to subscribers on                             
            his delivery route.  Normally petitioner was given extra                                   
            newspapers.  Petitioner used the extra newspapers to replace ones                          
            that were damaged.  In addition to the draw sheets provided to                             
            petitioner on a daily basis, each month the Star Telegram                                  
            provided petitioner with a circulation statement that indicated                            
            the number of newspapers petitioner was being charged for, the                             
            cost to petitioner of each newspaper, and, after various                                   
            adjustments,2 the amount that petitioner owed to the Star                                  
            Telegram for the newspapers he received during the month.                                  
            Normally petitioner attempted to satisfy his liability to the                              
            Star Telegram by the 15th day of the following month.                                      
                  Although the circulation statement reflected the number of                           
            newspapers charged to petitioner, it did not indicate the number                           
            of subscribers, or reflect any information regarding subscription                          
            plans.  Petitioner had approximately 925 customers in 1991 and                             

            2Adjustments were made for refunds, payments from                                          
            subscribers that were mailed directly to the Star Telegram,                                
            surety charges (to insure that petitioner would pay the bill),                             
            charge backs for returned checks (regardless of whether they were                          
            mailed to the Star Telegram or turned over to the Star Telegram                            
            by petitioner), and the application of credits related to special                          
            promotions or discounts.                                                                   

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Last modified: May 25, 2011