SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                  FORM 10-QSB

(Mark One)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                           EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1997 

                                      OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OF THE SECURITIES
                           EXCHANGE ACT OF 1934

            For the transition period from___________ to __________

                         Commission File No._____________

                             WHITEWING LABS, INC.
        (Exact name of small business registrant as specified in its charter)

            Delaware                                     95-4437350
   (State or other jurisdiction                       (I.R.S. Employer
 of incorporation or organization)                  Identification Number)

15455 San Fernando Mission Blvd., #105, Mission Hills, CA      91345
(Address of principal executive office)                      (Zip Code)

Registrant's Telephone Number:  (818) 898-2167

Check whether the issuer (1) filed all reports required to be filed by
Section 12 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]

The number of shares of common stock outstanding as of April 30, 1997 was 
2,866,938.





                                        1


                               WHITEWING LABS, INC.
                   FORM 10-QSB FOR QUARTER ENDED MARCH 31, 1997
                                TABLE OF CONTENTS

                                                                            Page
PART I.   FINANCIAL INFORMATION

Item 1.     Condensed Financial Statements

            Balance Sheets at December 31, 1996 and March 31, 1997...........3

            Statements of Operations for the Three  Months Ended
                March 31, 1996 and 1997......................................5

            Statements of Cash Flows for the Three Months Ended
                March 31, 1996 and 1997......................................6

            Notes to the Financial Statements................................8

Item 2.     Management's Discussion and Analysis of Results
              of Operations and Financial Condition.........................12

PART II.  OTHER INFORMATION.................................................17

Item 1.     Legal Proceedings

Item 6.     Exhibits and Reports on Form 8-K

SIGNATURE PAGE..............................................................18




























                                       2


<TABLE>

                               Whitewing Labs, Inc.
                                  Balance Sheets
                        December 31, 1996 and March 31, 1997

<CAPTION> 
                                     ASSETS 

 
                                             December 31,             March 31,
                                                 1996                   1997
                                             ------------           -----------
                                                                    (Unaudited)
     <S>                                     <C>                    <C> 
     CURRENT ASSETS: 
        Cash and cash equivalents            $ 2,524,391            $ 1,678,100
        Inventories                              143,519                158,842
        Prepaid advertising                      379,095                364,269
        Other prepaid expenses                    38,906                 52,310
        Other receivables                         46,604                 30,347
                                             -----------            -----------
           Total current assets                3,132,515              2,283,868
                                             -----------            -----------
     EQUIPMENT:
        Furniture and fixtures                   119,443                119,443
        Less--accumulated depreciation           (39,108)               (44,880)
                                             -----------            -----------
                                                  80,335                 74,563
                                             -----------            -----------
     OTHER ASSETS: 
        Deferred advertising                     182,061                129,141
        Investment in related-party 
          partnership, at cost                   100,000                100,000
        Deferred taxes                           220,000                200,000
        Other                                      5,345                  5,529
                                             -----------            -----------
                                                 507,406                434,670
                                             -----------            -----------
     TOTAL ASSETS                            $ 3,720,256            $ 2,793,101
                                             ===========            ===========

</TABLE>











                             See accompanying notes


                                       3
<TABLE>
                               Whitewing Labs, Inc.
                                  Balance Sheets
                        December 31, 1996 and March 31, 1997

<CAPTION>
                       LIABILITIES AND SHAREHOLDERS' EQUITY

                                             December 31,             March 31,
                                                 1996                   1997
                                             ------------           -----------
                                                                    (Unaudited)

     <S>                                     <C>                    <C>
     CURRENT LIABILITIES:
        Accounts payable                     $    295,393           $   81,378
        Accounts payable to shareholder            22,190                 -
        Accrued liabilities                        23,459                7,786
        Deferred taxes                            220,000              200,000
                                            -------------           ----------
             Total current liabilities            561,042              289,164
                                            -------------           ----------
     COMMITMENTS AND CONTINGENCIES:

     SHAREHOLDERS' EQUITY: 

         Common stock, $.001 par value: 
           Authorized, 10,000,000 shares 
           Issued and outstanding,
           2,891,388 shares at December 31,
           1996, and 2,851,938 shares
           at March 31, 1997                        2,891                2,891
         Paid-in capital                        6,318,977            6,318,977
         Accumulated deficit                   (3,117,235)          (3,742,525)
         Less--
           Treasury stock, at cost
            17,600 shares at December 31,
            1996 and 39,450 shares at
            March 31, 1997                        (45,419)             (75,406)
                                             ------------          -----------
         Shareholders' equity                   3,159,214            2,503,937
                                             ------------         ------------
                                             $  3,720,256         $  2,793,101
                                             ============         ============
</TABLE>










                             See accompanying notes


                                       4


<TABLE>
                               Whitewing Labs, Inc.
                             Statements of Operations
                 For the Three Months Ended March 31, 1996 and 1997
                                   (Unaudited)
<CAPTION>


                                                     1996                     1997  
                                                  ----------              ----------
<S>                                               <C>                     <C>       
     NET SALES                                    $  996,028              $  658,518

     COST OF GOODS SOLD                              130,164                  84,206
                                                  ----------              ----------
         Gross profit                                865,864                 574,312

     OPERATING EXPENSES
       Advertising                                   550,312                 521,770
       Selling                                       222,139                 494,836
       General and administrative                    233,818                 206,546
                                                  ----------             -----------
                                                   1,006,269               1,223,152
                                                  ----------             -----------
       Loss from operations                         (140,405)               (648,840)
 
     OTHER INCOME                                     23,775                  23,550
     INTEREST EXPENSE                                  4,259                    -
                                                  ----------             -----------
       Loss before provision
       for income taxes                             (120,889)               (625,290)

     PROVISION FOR INCOME TAXES                        3,605                    -
                                                  ----------              -----------
     NET LOSS                                       (124,494)               (625,290)

     PREFERRED STOCK DIVIDENDS
       EARNED AND ACCRUED                         $   10,073                    -
                                                  ----------             -----------

       Net loss attributable
       to common stockholders                     $ (134,567)               (625,290)
                                                  ==========             ===========

     LOSS PER COMMON SHARE                        $    (0.06)            $     (0.22)
                                                  ==========             ===========
     WEIGHTED AVERAGE NUMBER OF
        COMMON SHARES OUTSTANDING                  2,070,878               2,864,310
                                                  ==========             ===========
</TABLE>





                             See accompanying notes


                                       5
<TABLE>
                               Whitewing Labs, Inc.
                             Statements of Cash Flows
                For the Three Months Ended March 31, 1996 and 1997
                                  (Unaudited)
<CAPTION>
                                                             1996            1997
                                                          ---------       ----------
<S>                                                       <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES: 
   Net loss                                               $(124,494)      $ (625,290)
   Adjustments to reconcile net loss to net cash
     used in operating activities
        Depreciation and amortization                         4,002            5,772
        Changes in assets and liabilities:
           Inventories                                      (57,256)         (15,323)
           Prepaid advertising                              (24,019)          14,826
           Other prepaid expenses                           (43,308)         (13,404)
           Other receivables                                  1,503           16,257
           Deferred advertising                             (39,549)          52,920
           Other deposits                                    (5,243)            (184)
           Accounts payable                                 (48,745)        (236,205)
           Accrued liabilities                              (17,502)         (15,673)
           Accrued interest payable                         (43,051)            -
                                                         ----------       ----------
           Net cash used in operating activities           (397,662)        (816,304)
                                                         ----------       ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchases of furniture and fixtures                       (5,150)            -    
                                                        -----------       ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Deferred offering costs                                  174,261             -
   Payments to shareholder                                 (114,247)            -
   Net proceeds from issuance of common stock             4,107,849             -
   Net proceeds from issuance of common stock warrants      180,090             -
   Net proceeds from issuance of common
     stock upon exercise of options                         135,063             -
   Repurchase of common stock                                  -             (29,987)
   Payment of cash dividends                                (32,761)            -
                                                         ----------       ----------
           Net cash provided by financing activities      4,450,255          (29,987)
                                                         ----------       ----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS      4,047,443         (846,291)

CASH AND CASH EQUIVALENTS, beginning of year                423,622        2,524,391
                                                          ---------       ----------
CASH AND CASH EQUIVALENTS, end of period                 $4,471,065       $1,678,100
                                                         ==========       ==========







                              See accompanying notes


                                       6
                                                            1996            1997
                                                         ----------       ----------
SUPPLEMENTAL DISCLOSURES OF
   CASH FLOW INFORMATION:

     Cash paid for income taxes                          $    3,605       $     -
                                                         ==========       ==========
     Cash paid for interest                              $    4,259       $     -
                                                         ==========       ==========

SUPPLEMENTAL DISCLOSURES OF
   NON CASH FINANCING ACTIVITIES:

     Cumulative convertible preferred stock
       converted to common stock                         $  732,149       $     -
                                                         ==========       ==========


</TABLE> 




































                            See accompanying notes



                                         7
                              WHITEWING LABS, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                March 31, 1997
                                  (Unaudited)


1.    Summary of Significant Accounting Policies

    a.  Basis of presentation
    
    In the opinion of management and subject to year-end audit, the 
    accompanying unaudited financial statements have been prepared in
    accordance with generally accepted accounting principles for interim
    financial information.  Accordingly, they do not include all of the
    information and footnotes required by generally accepted accounting
    principles for complete financial statements.  In the opinion of
    management, all adjustments considered necessary for a fair presentation
    have been included.  The results of operations for the periods presented
    are not necessarily indicative of the results to be expected for the
    full year.  These condensed financial statements should be read in
    conjunction with the financial statements and footnotes thereto contained
    in the Company's Annual Report on Form 10-KSB for the year ended
    December 31, 1996.

    b.  Prepaid and Deferred Advertising

    In December 1993, the American Institute of Certified Public
    Accountants issued Statement of Position 93-7 (SOP 93-7) entitled
    "Reporting on Advertising Costs".  The Company adopted SOP 93-7
    effective January 1, 1995.

    Magazines, newspapers, weekly publications, and direct mailings
    including postcard inserts, tear sheets, holiday special mailers and
    the Journal of Natural Health "TM" comprise the main components of the
    Company's direct-response marketing efforts and its primary purpose
    is to elicit sales to customers. Payments to vendors in advance of the
    run date are included in prepaid advertising.  Respondents are logged
    into a customer base which indicates the source of each customer's
    response to the specific advertisement.

    The Company's accounting policy for amortizing the costs of prepaid and
    deferred advertising placements and mailings is based upon management's
    estimates over the periods in which the related direct responses are
    received.  The Company evaluates the realizability of its direct-
    response advertising by comparing the carrying amount of prepaid and
    deferred advertising at each balance sheet date on a cost-pool-by-cost-
    pool basis to the probable remaining future net revenues expected to
    result from such advertising.  Any excess carrying amount over probable
    remaining future revenues is reported as advertising expense in the
    current period.  Newspaper and weekly publications are expensed in the
    month of issue.  Magazines and direct mailings which are available
    prior to the middle of the month preceding the issue date are amortized
    over a three month period.  Magazines which are available subsequent to
    the middle of the month preceding the issue date are amortized over a
    four month period.  The magazine amortization percentages used by the
    Company amortize 90 to 100 percent of the deferred cost over three



                                         8
    months with 60 to 80 percent of the costs amortized over two months and
    such costs are included in other assets as deferred advertising.
    Substantially all of the deferred advertising costs will be fully
    amortized within four months of December 31, 1996.  For the three months
    ended March 31, 1996 and 1997 respectively, advertising expense was
    $550,312 and $521,770 respectively.

    Prepaid advertising includes approximately $254,000 of costs related to
    the development of electronic in-home delivery of product advertising
    which the Company began test airing in February 1997.  Additional
    unpaid costs of electronic delivery advertising of $27,450 are due
    and payable in 1997. The Company is obligated to pay related talent
    costs of 3 percent of gross profits from sales generated in 1997 after
    the test airing is completed.  It is management's intention to expense
    the costs related to the electronic in-home delivery of product
    advertising beginning in 1997 and over a period not to exceed
    the lesser of the revenue earning stream directly related to the
    electronic in-home delivery of product advertising or one year, which
    ever comes first.

    c.  Reclassifications
    
    Certain reclassifications have been made to the accompanying condensed
    financial statements to conform them with the current period presentation.

    d.  Estimates Used by Management

    The preparation of financial statements in conformity with generally
    accepted accounting principles requires management to make estimates
    and assumptions that affect the reported amounts of assets and
    liabilities and disclosure of contingent assets and liabilities at the
    date of the financial statements and the reported amounts of revenues
    and expenses during the reported period.  Actual results could differ
    from those estimates.

    e.  Concentration of Risk

    Production, order taking and order fulfillment are outsourced to an 
    outside company and two independent contractors, respectively, which
    potentially subjects the Company to a concentration of supplier risk.
    In addition, substantially all printing is handled by an outside
    company and substantially all advertising placement, including purchase
    of mailing lists for direct mail programs, is handled by an outside
    service agency.  Although these services are currently concentrated
    with a few key suppliers, management believes that other suppliers
    could provide similar services and comparable terms.  A change in
    suppliers however could cause delay in manufacturing, shipping,
    advertising placements and implementation of direct mail programs and a
    possible loss of sales which could affect operating results adversely.










                                           9
2.  Summary of Operations

    a.    Reincorporation in Delaware

    On February 9, 1996, the Company merged with Whitewing Labs, Inc., a
    Delaware corporation, which recently was formed as a wholly-owned
    subsidiary of the Company and reincorporated in the State of Delaware
    (the "Reincorporation"). As a result of the Reincorporation, each holder
    of outstanding common stock of the Company, and each holder of the
    outstanding preferred stock, received three shares of the Delaware
    corporation's common stock for every two shares of the Company's common
    stock or preferred stock held of record on the Effective Date of the
    Reincorporation.

    b.    Proceeds from Completion of Initial Public Offering

    On February 20, 1996, the Company completed its initial public offering
    and issued 900,000 shares of common stock and 1,035,000 common stock
    purchase warrants.  On March 18, 1996, the Company issued an additional
    135,000 shares of common stock which reflected shares of common stock
    set aside to cover any over-allotments related to the public offering.
    Total proceeds related to the issuance of the 1,035,000 shares of
    common stock and common stock purchase warrants were approximately 
    $4,270,000 which is net of $412,092 in offering costs and $699,660 in 
    broker discounts.


3.    Loss per Common Share

    For the three month periods ended March 31, 1996 and 1997 respectively,
    loss per common share is based on the historical weighted average number
    of shares outstanding.

4.    Product Return Reserve

    An accrual for estimated sales returns is included in accrued liabilities
    in the amounts of $20,000 and $5,000 at December 31, 1996 and 
    March 31, 1997, respectively.

5.    Stock Repurchase

    During the three months ended March 31, 1997, the Company acquired 21,850
    shares of its common stock for approximately $29,900 in connection with a
    stock repurchase program in which up to 200,000 shares or 7% of outstanding
    shares of the Company's common stock may be acquired in the open market.

6.    Litigation

    The Company was notified by letter dated January 12, 1996, that the
    Federal Trade Commission (FTC) was conducting a preliminary, non-public
    investigation regarding the advertising and sale of Prostsafe "R", which
    represented 79% of total Company sales during the year ended December 31,
    1996.  The Company did not believe that this advertisement made any false
    or unsubstantiated claims and had submitted a formal written response to
    the FTC inquiry.  On March 26, 1997, the Company was notified by its legal
    counsel that the FTC had concluded its investigation and closed its file
    without taking any action.


                                           10
    On August 16, 1996, a former director of the Company and her husband,
    filed a legal action against the Company and Acacia Research Corporation
    its largest shareholder, in the United States District Court in Los
    Angeles, entitled Christopher D. Hodges and Ann P. Hodges v. Acacia Research
    Corporation and Whitewing Labs, Inc., Case No 96-5551R (Ex).  The suit
    alleged, among other things, that the Company improperly refused to permit
    the exercise of an option to purchase 15,000 shares of the Company's 
    common stock and seeks $106,000 in damages from the Company.  Legal
    counsel was jointly retained by the Company and Acacia, the co-defendant,
    and Acacia assumed primary defense thereof, as well as assuming sole
    responsibility for all litigation costs incurred in connection with such
    joint representation.  On May 7, 1997, the lawsuit was settled with no
    associated costs due from the Company.

7.    Advertising

    The Company has commitments for magazine placements of $67,178 at 
    March 31, 1997.

8.    Earnings per Share and Capital Structure

    In March 1997, the FASB issued SFAS No. 128, "Earnings per Share" 
    (SFAS 128) and SFAS 129 "Disclosure of Information about Capital
    Structure" (SFAS 129).  SFAS 128 revises and simplifies the computation
    for earnings per share and requires certain additional disclosures.  SFAS
    129 requires additional disclosures regarding the Company's capital
    structure.  Both standards will be adopted in fiscal 1997.  Management
    does not expect the adoption of these standards to have a material effect
    on the Company's financial position or the results of operations.


9.    Subsequent Events

    Subsequent to March 31, 1997, the Company has repurchased 2,000 shares
    of common stock for $1,500 and may or may not make future repurchases.
























                                           11
Item 2.  Management's Discussion and Analysis of Results of Operations and
         Financial Condition


General. The Company formulated its business plans and strategies based on
certain assumptions of the Company's management regarding the size of the
market for nutritional supplements, the products which the Company will be
able to offer to the over age forty market, the Company's anticipated share of
the market, and the estimated prices for and acceptance of the Company's
products. Although these plans and assumptions are based on the best estimates
of management, there can be no assurance that these assessments will prove to
be correct.  No independent marketing studies have been conducted on behalf of
or otherwise obtained by the Company, nor are any such studies planned.  Any
future success that the Company might enjoy will depend upon many factors,
including factors which may be beyond the control of the Company or which
cannot be predicted at this time.  These factors may include product
obsolescence, increased levels of competition, including the entry of
additional competitors and increased success by existing competitors, changes
in general economic conditions, increases in operating costs including costs of
supplies, personnel and equipment, reduced margins caused by competitive
pressures and other factors, and changes in governmental regulation imposed
under federal, state or local laws.

The Company's stated strategy for the development of its business is to stress
growth of the customer base over short-term profits; management believes
that, in the long run, potential net earnings will be driven by continued
growth of the customer base.  During the first quarter of 1997, utilizing
a portion of the net proceeds from its February 1996 public offering, the
Company continued its efforts to expand the customer base by investing
approximately $1,100,000 in a combination of marketing and selling activities,
including magazine advertising placements, direct mail which both tests new
mailing lists and identifies new names on lists used in the past, and testing
of electronic in-home delivery of product advertising.  While losses were
anticipated in building the customer base, they have been greater than
expected.  This was in part due to steadily increasing competition over the
last year for the flagship product, Prostsafe"R".  The Company has made several
substantial investments by both expanding its product line to 27 products and
increasing the customer base from 59,000 in March of 1996 to over 89,000
currently.  In view of the expanded customer base, the Company has now modified
its marketing strategy for the short term by significantly reducing advertising
and certain selling expenditures related to attracting additional customers, as
it focuses on efforts to generate additional revenue from existing customers.

    As of March 31, 1997, the Company had an accumulated deficit of $3,742,525.
It can be expected that future operating results will continue to be
subject to many of the problems, expenses, delays and risks inherent in the
establishment of a new business enterprise, many of which the Company cannot
control.  There can be no assurance, therefore, that the Company will be able
to achieve or sustain profitability.  Even if the Company's operations prove
to be marginally profitable, the value of the Company's common stock, and the
potential return to investors, could be substantially diminished.
Consequently, an investment in the Company is highly speculative and no
assurance can be given that purchasers of the shares of common stock will
realize any return on their investment or that purchasers will not lose their
entire investment.




                                       12
    Like other distributors of consumer products, the Company encounters the
risk of product returns from its customers.  The Company's products are sold
with an unconditional, money-back guarantee.  Any customer who is not
satisfied with a Company product for any reason may return it or any unused
portion for a full refund of the purchase price.  Although product returns over
the last three years have been approximately 3% of sales, which is substantially
less than the national average of 6%, there can be no assurance that actual
levels of returns will not significantly exceed amounts which have occurred in
the past.

    The Company's operating results may vary significantly due to a variety of
factors including changing customer profiles, the availability and cost of raw
materials, the introduction of new products by the Company or its competitors,
the timing of the Company's advertising and promotional campaigns, pricing
pressures, general economic and industry conditions that affect customer
demand, and other factors.

    In March 1997, the FASB issued SFAS No. 128, "Earnings per Share"
(SFAS 128) and SFAS 129 "Disclosure of Information about Capital Structure"
(SFAS 129).  SFAS 128 revises and simplifies the computation for earnings per
share and requires certain additional disclosures.  SFAS 129 requires
additional disclosures regarding the Company's capital structure.  Both
standards will be adopted in fiscal 1997.  Management does not expect the
adoption of these standards to have a material effect on the Company's
financial position or the results of operations.

    Statements contained herein that are not purely historical are forward-
looking statements within the meaning of Section 27A of the Securities Act of 
1933 and Section 21E of the Securities Exchange Act of 1934, including but not
limited to statements regarding the Company's expectations, hopes, beliefs, 
intentions or strategies regarding the future.  Actual results could differ
materially from those projected in any forward-looking statements as a result
of a number of factors, including those detailed in this Management's
Discussion and Analysis of Results of Operations and Financial Condition, as
well as those set forth elsewhere herein.  The forward-looking statements are
made as of the date of these financial statements and the Company assumes no
obligation to update the forward-looking statements, or to update the reasons
why actual results could differ materially from those projected in the
forward-looking statements.




















                                            13
Results of Operations.

Net Sales.  The Company's net sales during the quarter ended March 31, 1997
were $658,518, a decrease of approximately 33.9% over net sales of $996,028
during the quarter ended March 31, 1996.  At March 31, 1997, the Company's
customer base had grown to approximately 89,000, up from approximately 59,000
at March 31, 1996.  Sales, particularly of the Company's flagship product,
Prostsafe "R", did not increase to the levels anticipated, relative to the
substantial increase in selling costs.

    The average orders from new and existing customers were approximately
$61 and $76 respectively, for the quarter March 31, 1997, compared
to average orders of approximately $55 from new customers and $82 from
existing customers respectively for the first quarter of the prior year.

    Sales of the Company's Prostsafe "R" accounted for 68.2% of the Company's
sales for the quarter ended March 31, 1997, and for approximately 81.3% of
net sales for the quarter ended March 31, 1996.  The Company anticipates
that sales of Prostsafe "R" will continue to contribute a substantial but
continually decreasing percentage of total revenues to subsequent periods,
as quantities sold of the Company's other products increase.  A decline in
the demand for this product, whether as a result of competition or other
factors, could have a material adverse effect on the Company's results
of operations and financial condition.  The markets for the Company's products
are characterized by changing customer demand, short product life cycles, and
frequent new product introductions.  The performance of the Company will depend
on the ability of the Company to develop and market new products that will gain
customer acceptance and loyalty, as well as its ability to adapt its product
offering to meet changing pricing considerations and other market factors.  The
Company's operating performance would be adversely affected if the Company were
to incur delays in developing new products or if such products did not gain
market acceptance.  Therefore, there can be no assurance that the Company's
existing or future products will be sufficiently successful to enable the
Company to effectively compete in its prospective markets or, should the 
Company's product offerings meet with significant customer acceptance, that 
one or more current or future competitors will not introduce products which 
adversely affect the Company's product marketshare.


Gross Profit.  Cost of goods sold for the Company's products represented
12.8% and 13.0% of net sales for the three months ended March 31, 1997 and
1996 respectively.  During the quarters ended March 31, 1997 and 1996,
the Company recognized gross profits of $574,312 and $865,864, or 87.2% and
87.0% of net sales, respectively.


Advertising Expense.  During the three months ended March 31, 1997,
advertising expense decreased to $521,770, compared to $550,312 for
the same period last year.  The decrease reflects fewer magazine placements
made in the first quarter of 1997.  While advertising decreased in absolute
dollars during the quarter ended March 31, 1997, it increased as a percentage
of net sales to 79.2% compared to 55.3% of net sales for the same period last
year. 






                                         14
Selling Expense.  During the three months ended March 31, 1997, selling
expenses increased to $494,836, compared to $222,139 for the same period in
1996, and increased as a percentage of net sales to 75.1%, compared to 22.3%
of net sales for the three months ended March 31, 1996.  The increase 
is primarily due to a more aggressive direct mail program in the first quarter
of 1997 compared to 1996 and costs incurred to test electronic in-home delivery
of product advertising.  The Company expects to benefit in future periods from
the conversion of leads obtained from electronic in-home delivery of product
advertising to customers.


General and Administrative Expense.  General and administrative expenses 
decreased in absolute dollars to $206,546 for the first three months of 1997,
from $233,818 for the first three months of 1996, primarily due to a decrease 
in legal costs, which were incurred on a one-time only basis in the first
quarter of 1996.  For the quarter ended March 31, 1997, general and
administrative expenses represented 31.4% of net sales, increasing as a
percentage of net sales from 23.5% for the three months ended March 31, 1996.


Loss From Operations.  The Company incurred losses from operations for the
three months ended March 31, 1997 of $648,840, compared to losses from
operations of $140,405 during the three months ended March 31, 1996.  Losses
during the first quarter of 1997 and 1996 were mainly attributable to increases
in advertising and selling costs as the Company sought to aggressively expand
its customer base.  Anticipated revenues for the first quarter of 1997 from
mailings to existing customers, magazine placements and the testing of
electronic in-home delivery of product advertising, did not materialize
resulting in a substantial loss for the first quarter of 1997.


Interest Expense.  There was no interest expense for the three months ended
March 31, 1997.  The amounts remaining due and payable to Acacia Research
Corporation, including interest expense of $4,259, were paid out of the net
proceeds to the Company from the public offering during the first quarter of
1996. For the three months ended March 31, 1996, interest expense represented
0.4% of sales.


Liquidity and Capital Resources

    In its initial public offering in February 1996, the Company raised net
proceeds, after deduction of underwriting discounts and other expenses of the
offering amounting to $1,111,752, of approximately $4,270,000. The Company's
public offering was to generate adequate funds to allow for growth of the
Company's sales and database than might be achieved if the Company relied
only upon revenues generated from sales.  A large portion of the net proceeds
to the Company, was earmarked to finance expanded advertising, marketing and
sales activities, with the balance available for use for other general
corporate purposes to support the Company's ongoing operations, including
general administrative costs and expenses.  

    At March 31, 1996, the Company had cash on hand of $4,471,065.  A portion
of these proceeds was used to pay the principal balance of $114,247, plus
accrued interest of $47,310 owing to Acacia in respect of loans previously made
to the Company by Acacia, the Company's largest shareholder.  A portion of
the proceeds was also used to build inventories and finance magazine and direct
mail advertising.

                                          15
    At March 31, 1997, the Company had cash on hand of $1,678,100 down
$846,291 from the December 31, 1996 amount of $2,524,391.  The decrease
was primarily the result of a $236,205 decrease in accounts payable relating
mainly to expenditures for magazine advertising and for development and testing
of electronic in-home delivery of product advertising.

 The Company initiated an open market stock repurchase program in July 1996
in which up to 200,000 shares or 7% of outstanding shares of the Company's
common stock may be acquired in the open market.  The Company acquired 21,850
shares of its common stock for approximately $29,900 during the first three
months of 1997 bringing the total shares acquired to date to 39,450.  The
Company has authorized a repurchase of up to an additional 10,150 shares and
may or may not make future repurchases.

    The Company believes that expected cash flow plus the remaining proceeds
from the offering will finance the Company's operations at currently
anticipated levels for a period of at least 12 months.  However, there can be
no assurance that the Company will not encounter unforeseen difficulties that
may deplete its capital resources more rapidly than anticipated.








































                                           16
PART II  OTHER INFORMATION

Item 1.     Legal proceedings
      The Company was notified by letter dated January 12, 1996, that the
      Federal Trade Commission (FTC) was conducting a preliminary, non-public
      investigation regarding the advertising and sale of Prostsafe "R".  The
      Company did not believe that this advertisement made any false or
      unsubstantiated claims and had submitted a formal written response to
      the FTC inquiry. On March 26, 1997, the Company was notified by its legal
      counsel that the FTC had concluded its investigation and closed its file
      without taking any action.

      On August 16, 1996, a former director of the Company and her husband,
      filed a legal action against the Company and its principal shareholder
      in the United States District Court in Los Angeles, entitled
      Christopher D. Hodges and Ann P. Hodges v. Acacia Research Corporation
      and Whitewing Labs, Inc., Case No 96-5551R (Ex).  The suit alleged,
      among other things, that the Company improperly refused to permit the
      exercise of an option to purchase 15,000 shares of the Company's 
      common stock and seeks $106,000 in damages from the Company.  
      Legal counsel was jointly retained by the Company and Acacia, the
      co-defendant, and Acacia assumed primary defense thereof, as well as
      assuming sole responsibility for all litigation costs incurred in
      connection with such joint representation.  On May 7, 1997, the lawsuit
      was settled with no associated costs due from the Company.

Item 6.     Exhibits and reports on Form 8-K

              Exhibit 27, Financial Data Schedule                Page 19






























                                          17
SIGNATURE PAGE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized


                                       WHITEWING LABS, INC.


Date:  May 13, 1997                      /s/    Cynthia Kolke
                                       ---------------------------
                                       Cynthia Kolke,
                                       President, Assistant Secretary
                                       and Director

                                         /s/  Elizabeth M. Meisler
                                       ---------------------------
                                       Elizabeth M. Meisler,
                                       Chief Financial Officer





































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