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paid to member stores leaves us less than clear as to the
substance of respondent’s argument concerning control.
As set forth supra in section III.A., respondent claims as a
fact: “Petitioner negotiated for the food show rebates and
thereby provided for the direct payment of moneys from vendors to
members that would otherwise have accrued to Affiliated as
earnings, i.e., rebated from vendors to Affiliated for product
purchased for sale by Affiliated.” While it is true that
petitioner negotiated with respect to show money and had the
right to final approval and, therefore, exercised some control
over show money, petitioner’s authority and rights were the same
irrespective of whether the vendor chose to use petitioner-
delivered or vendor-provided currency to pay show money to member
stores. Yet respondent’s adjustments increasing petitioner’s
income on account of rebates petitioner is deemed to have
received is made only with regard to petitioner-delivered
currency (and without regard to vendor-provided currency). If
negotiation and approval with respect to show money signify
control, then we do not see why those factors do not equally
signify control with respect to vendor-delivered currency. The
singular distinction between petitioner-delivered and vendor-
provided currency is that the former came to vendors from
petitioner’s hands. As explained in the next two paragraphs, we
do not see that distinction as justifying different treatment.
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Last modified: November 10, 2007