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be made using its nonprofit mail permit, (5) actively endorsing
and sponsoring the acquisition of the affinity credit card
through brochures and letters from its officers, (6) guaranteeing
refunds of the annual fee if the Chase Lincoln imposed such a
charge, and (7) attempting to persuade the Chase Lincoln to relax
its credit tolerances so that additional affinity credit cards
could be issued and higher profits realized.
2. Control of Marketing Plans
a. SC-ABS Agreement
Respondent argues that petitioner controlled the marketing
plans for the credit card program, and, thus, petitioner was
compensated for providing services. Petitioner’s rights and
duties with respect to marketing are set forth in the SC-ABS
agreement. For the most part, the SC-ABS agreement assigns to
ABS responsibility for marketing the credit card program.
Article 4.2 assigns to ABS the initiative for developing
marketing plans: “ABS shall be responsible for the development
of all promotional and solicitation materials and programs
designed to encourage the acquisition and usage of the Services
by the members”. Article 4.2 imposes on ABS the cost of such
materials and programs, unless petitioner elects (which it did
not) to pay for production and mailing costs in consideration of
a larger payment. Article 3.3 places with ABS the initiative to
propose additional services to offer to the members.
Article 4.2 subjects promotional and solicitation materials
and programs developed by ABS to approval by petitioner.
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