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meet the spirit and letter of the subject regulation. Mr.
Dodds’s uncontradicted testimony reflected that there were some
differences in the categorization of accounts25 and in the
individual trading volume or activity of customers, but that the
clientele of both firms was substantially similar. Both were
discount brokerages, and they competed in the same market for
their clientele.
Petitioner also notes that respondent’s expert’s report,
using petitioner’s preacquisition revenue experience, resulted in
predictions of the postacquisition revenue stream from Rose
accounts with better than 80-percent accuracy in early years and
98-percent accuracy for the third and fourth years after
acquisition. Further, petitioner highlights the fact that it was
the leader in the discount broker industry with a 42.4-percent
market share. That fact made petitioner’s experience, within the
meaning of the regulation, sufficiently “adequate” to determine
the useful lives that the Rose accounts were likely to have in
the context of petitioner’s business.
Ultimately, the disagreement between the parties boils down
to the degree of similarity needed to invoke the use of one’s own
25 Specifically, Rose had more institutional customers.
Respondent also argues that petitioner’s expert (Mr. Knoblick)
used shorter lives in his analysis than were estimated by Mr.
Dodds in connection with the preacquisition analysis of Rose. We
pay little heed to respondent’s point because Mr. Knoblick’s
analysis was based on an actuarial approach, comprising a
complete historical analysis of all of petitioner’s accounts.
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