United Cancer Council, Inc. - Page 75

                                       - 59 -                                         
               As of May 19, 1989, near the end of the term of the                    
          Contract, petitioner’s housefile contained a total of 2,084,019             
          donor names, of which 1,165,153 were “active names” and 918,866             
          were “inactive names”.16  As of May 8, 1989, petitioner’s                   
          housefile contained 1,164,698 “active donor names”, which had               
          been produced from the sources indicated in table 9.                        
                                       Table 9                                        
                    Source                Number of Names                             
                    Sweepstakes Mailings               810,411                        

               15(...continued)                                                       
          which 19,915,212 were sweeps letters.  The stipulated status                
          report shows 75 housefile mailings, but a total of only                     
          21,849,216 letters.  The 47 sweeps housefile mailings that we               
          were able to identify involved 17,313,153 letters.                          
               It may be that the status report misidentified mailings                
          totaling about 6,000,000 names.  Although the discrepancy between           
          the stipulation and the stipulated exhibit is substantial (more             
          than 10 percent of the total), it does not affect our ultimate              
          conclusions.                                                                
               16   The parties stipulated to these numbers of “active                
          names” and “inactive names”.  An invoice dated May 19, 1989, to             
          petitioner from Wiland, the computer company that maintained                
          petitioner’s housefile, reflects that Wiland had prepared a                 
          computer tape of petitioner’s housefile that contained 1,165,153            
          “active names” and 918,866 “inactive names”.  According to Dan              
          Wells, an employee of Wiland who testified at trial, “active                
          names” were the names that petitioner had mailed most recently.             
          Interestingly, Watson, during his testimony, estimated that                 
          petitioner’s housefile, as of the May 30, 1989, date petitioner’s           
          contract with W&H ended, contained approximately 250,000 to                 
          300,000 “active names” and another 1 million “inactive names”.              
          Watson, however, defined “active names” to be names which, at               
          that point, would produce a profit if mailed to, and “inactive              
          names” to be names which, at that point, would not produce a                
          profit if mailed to.  He elaborated that the actual                         
          categorization of a particular name as “active” or “inactive”               
          results from applying a complex statistical aging formula.                  




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