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Kyle-Beth: Brand managers may have technical or marketing reasons for prioritizing Facebook, Twitter, their websites, or other platforms. Often there are also legal reasons. Each platform has rules for promotions that change frequently. Legal counsel can help the trademark determine how to interpret these rules. Contest/sweepstakes sponsors should exercise caution when announcing prizes using a prize`s brand name in the title without the consent of the trademark owner. For example, if you offer an Apple iPod, the name of the contest cannot be “Apple” or “iPod” unless Apple has co-sponsored the promotion or accepted it in the contest title. However, you can list the item in the official rules as part of the price list. In addition, competition also means a random or skill-testing contest in which 2 or more participants compete for prizes. Under Nevada state law, a contest means a contest between customers for a prize, regardless of whether – prohibits purchase requirements, even if contest winners are selected based on their skills. Official rules should highlight important U.S.
legal requirements, including: Comprehensive competition management Creating or running a contest can be simplified with the help of a contest administrator or digital promotion company. When it comes to sweepstakes. A lottery requires a purchase, payment or other consideration (the participant must buy something, such as a ticket), chance and a prize. Private lotteries are illegal under state law. In addition, under federal law, it is illegal for U.S. citizens to participate in a foreign lottery. Do not run a lottery. This blog is provided by Romano Law PLLC for general and educational information purposes only, and not to provide specific legal advice.
By using this blog, you understand that there is no client relationship between you and Romano Law PLLC or any individual contributor. You should consult a licensed professional lawyer for individual advice regarding your own situation. Sweepstakes and contests have grown in popularity to attract consumers. However, the legal requirements for these games are complex. Domenic Romano and Kyle-Beth Hilfer of Hilfer Law recently discussed common questions about the introduction of these sweepstakes and legal advice. Social media contests are a great way to retain customers/users, find new customers/users, and collect useful marketing data. However, sponsorship of such advertising campaigns requires the inclusion of legal regulations and restrictions, which can be confusing – or worse. Since one of your goals is to have fun with your customers and potential customers, the last thing you want to do is get in trouble with the law. First, it`s important to understand the differences between sweepstakes and contests (which are legal advertising campaigns) and private sweepstakes (which are illegal under state law). Kyle-Beth: In the United States, gifts are subject to lottery and gambling laws in each of the 50 states. There are also certain federal laws and regulations that may apply under Section 5 of the Federal Trade Commission Act.
For a promotion to be legal, it generally cannot contain the three elements of price, opportunity, and consideration. Lottery and gambling laws interpret these elements slightly differently, but after eliminating one of the three elements, a trademark would normally have a legal gift. A skill contest would eliminate chance, although in a handful of states the financial reward for participation is always a problem. A draw would eliminate all consideration. Consideration means either a monetary requirement or a substantial consideration. Nowadays, sweepstakes and contests have become difficult due to the pursuit of consumer loyalty. Many promotions are hybrids between sweepstakes and contests and require verification to ensure their legality. In Colorado, contests and sweepstakes are prohibited from requiring entrants to purchase or return to participate in a promotion. Most states allow purchase requirements in contests where winners are selected based on skills or criteria.
Kyle-Beth: Every draw or skill contest should have rules in one form or another. The rules are the contract between the sponsor and the participants. The rules protect the Sponsor in the event of a problem with the Promotion (for example, a virus infects the entry platform, resulting in multiple winners, or an entrant submits an entry that the Sponsor wishes to declare ineligible). Unfortunately, too many marketers are casual in this field. They can copy other rules they see on social media without doing their own legal review. They may mistakenly trust their managing authority to write the rules. Too often, they can publish inconsistent rules on different platforms. By not drafting a complete set of rules, brands invite ambiguity in their promotions and increase their legal risk. Additionally, due to limited textual space on social media, game sponsors often disclose the rules incompletely. Challenge means defending oneself against an adverse claim made in court by a plaintiff or attorney; challenge a position taken in the context of legal proceedings.
For example, a disgruntled relative may formally challenge the succession of a will. A prize draw is a campaign in which participants can win a prize based on chance. No purchases, payments or other consideration are permitted, and the winner will be randomly selected. The consideration element may not be present in a competition. Caution: The consideration is anything that the participant must give up to participate, monetary or not, and may exist if the participant has to devote a lot of time or effort that benefits the sponsor. For example, some States have determined that the provision of contact information is considered if the information is to be used for marketing purposes. Kyle-Beth: Now that you`ve completed your promotion, you may have collected participants` email addresses and mobile phone numbers. Before you rush to send them marketing materials, keep in mind that these actions may violate the Consumer Protection Act over the phone, the CAN-SPAM Act, and other laws. It`s always best to review your post-promotion marketing plan with legal counsel before launching the campaign.
If you plan to run a social media contest or any other type of online giveaway, you need to make sure you abide by the laws of your place of residence and the rules of the platform on which you host it. You can read Facebook`s rules here; Twitter is here; Instagram is there and Pinterest is there. (For inspiration, you can also see the template we created with our lawyer here.) Contests and sweepstakes are great strategies to connect with your audience and achieve your marketing goals.