Social media platforms and the Internet have helped the popularity of online sweepstakes and contests explode over the last few years. In order for a business to limit its liability when conducting these types of promotions, it is important to have the proper legal documentation in place. To ensure a business is protected, there are several provisions that should be included in its legal documentation. For example, the sweepstakes or contest needs to include the proper disclaimers and disclosures, outline an official set of rules, have appropriate releases for participants and winners, as well as provide clearly defined provisions regarding compliance with applicable state and/or federal laws.

Consumer Protection Laws

Online promotions may be required to provide contestants with basic information about the game, and may address other potential legal issues. For example, use of the Internet allows for participants to more easily submit repetitive entries. Similarly, promotions that encourage or require participants to “share” content may also raise intellectual property (IP) issues, such as third-party copyright infringement. As such, companies should ensure that they secure the proper releases needed for any promotional material to be used in connection with the winner.

Sweepstakes Law

The collection of personal information, whether purposeful or unintentional, from participants can also trigger legal issues. For instance, companies must ensure that their promotion does not violate any federal regulations regarding privacy or collection of personal information. Online sweepstakes via the Internet may also be subject to varying state laws based on the location of the participant or can trigger regulation under the Children Online Privacy Protection Act (“COPPA”) if they target children.

Online Contests and Internet Sweepstakes

For those businesses interested in running an online contest or sweepstakes, we can assist by ensuring that proper disclaimers and releases are in place. We will also analyze the framework of the contest or sweepstakes to ensure compliance with both state and federal law as it applies to the activities.