Sponsors who run contests, you should read this...
I'm not trying to rain on anyone's parade here and I certainly don't want to see all the contests go away so...
I used to work for a company that does sweepstakes, contests, etc... for Fortune 100 companies so I'm fairly well versed in all the law behind offering contests...
I could, if I wanted to be an ass, demand to be a winner of nearly every contest / drawing / sweepstakes on this board... and have legal grounds for doing so.
First, any promotion (read Contest or Sweepstakes), with prizes valued over $X amount, has to be registered and the prize value bonded with the state. In Florida this amount is, or at least used to be, $5000. I'm unsure as to this value in other states and which states require this however I do know that some states require ALL sweepstakes to be registered.
Second, official rules are a MUST. They have to be formatted very specifically and contain certain verbiage...
With those two elements not being fulfilled you are exposing yourselves to massive legal risk. Your one $5k contest could bring in a class action lawsuit and you may be liable for paying that $5k out to everyone that feels they could have won (named in the suit). Not only that but depending on your state you may invite additional fines and even criminal charges...
I mention this to help people out. I don't want to see anyone get burned when they're trying to do something rewarding for affiliates / whomever... Additionally you should be aware that some states even require you to register a sweepstakes with them even if the originating state is not their own. This is why you see a lot of legal jargon in things that say, this offer is void in X, Y, Z states...
Sorry to be the bearer of pain in the ass news but... protect yourselves! It's really not that expensive to have someone specialized in Promotions draft you up some official rules that you'll be able to use over and over again. You could also spend a few minutes with them on the phone to cover some basic understanding of the laws and what you can and can not do.
Best of luck!
I used to work for a company that does sweepstakes, contests, etc... for Fortune 100 companies so I'm fairly well versed in all the law behind offering contests...
I could, if I wanted to be an ass, demand to be a winner of nearly every contest / drawing / sweepstakes on this board... and have legal grounds for doing so.
First, any promotion (read Contest or Sweepstakes), with prizes valued over $X amount, has to be registered and the prize value bonded with the state. In Florida this amount is, or at least used to be, $5000. I'm unsure as to this value in other states and which states require this however I do know that some states require ALL sweepstakes to be registered.
Second, official rules are a MUST. They have to be formatted very specifically and contain certain verbiage...
With those two elements not being fulfilled you are exposing yourselves to massive legal risk. Your one $5k contest could bring in a class action lawsuit and you may be liable for paying that $5k out to everyone that feels they could have won (named in the suit). Not only that but depending on your state you may invite additional fines and even criminal charges...
I mention this to help people out. I don't want to see anyone get burned when they're trying to do something rewarding for affiliates / whomever... Additionally you should be aware that some states even require you to register a sweepstakes with them even if the originating state is not their own. This is why you see a lot of legal jargon in things that say, this offer is void in X, Y, Z states...
Sorry to be the bearer of pain in the ass news but... protect yourselves! It's really not that expensive to have someone specialized in Promotions draft you up some official rules that you'll be able to use over and over again. You could also spend a few minutes with them on the phone to cover some basic understanding of the laws and what you can and can not do.
Best of luck!
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ICQ:494318698 
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