CoNTEsTs wiTh CoNsuMEr
before offering any promotion in which consumers are
required to pay money or purchase a product.
GENErATEd CoNTENT PosE
In a contest, it is important to ensure winners are selected
risks As wEll As rEwArds
on the basis of skill (as opposed to chance). It may be
easy to do this if you select winners, but it’s harder to
Gonzalo E. Mon
ensure skill controls with public voting because members of
the public may try to manipulate the outcome. This often
results in complaints and forces companies to engage in
damage control. If public voting is important, you may
be able to reduce risks by combining public voting with
internal judging and bylimiting the number of times a
person can vote.
LIABILITY foR CoNTENT PoSTED BY CoNSuMERS
Although a company can usually ensure its own content
complies the law, it is harder to ensure that content
submitted by consumers is compliant. Often, materials
submitted by consumers will contain content — including
music, images, and shots of other people — that could
violate a third party’s rights. If a third party finds that its
intellectual property or publicity rights have been violated
by content posted on a company’s website, that party may
take action against the company, rather than against the
person who posted the content.
The first line of defense is a good set of disclosures in
the contest rules and advertisements. Companies should
clearly disclose that entrants may not submit content that

contains, for example, any elements that violate a third
A growing number of companies are running contests in
party’s copyrights or trademark rights and that content
which consumers are invited to create videos, commercials,
should not depict any individuals that have not granted
or other content for the chance to win prizes. Although
permission to be in the submissions. In some cases, it may
many of these contests have been extremely successful, for
be beneficial to screen submissions, but whether that is
every success story, there are many contests that have been
possible may depend on the resources at the company’s
plagued by missteps. A few of these missteps have been
disposal, the technology used, and the number of
highly publicized or resulted in lawsuits. And many others
submissions.
have gone unreported due to skillful damage control on the
part of companies running the contests.
Companies can take some comfort in laws that provide
immunity for content that is posted by others. For example,
These types of contests can offer many benefits, including
the Digital Millennium Copyright Act provides a safe
publicity and increased sales for a relatively small investment,
harbor to companies that, among other things, promptly
but they can also pose a number of challenges. In addition
take down content after they are informed that it infringes a
to the legal requirements that apply to all types of contests,
third party’s copyrights. And the Communications Decency
there is an inherent risk in putting so much power in the
Act provides some protection from liability for publishing
hands consumers. The more control that is given to
false or defamatory material provided by another party.
consumers, the less control the company running the contest
The limits of protection offered by these laws is currently
will have. Fortunately, there are strategies companies can
being tested in various lawsuits, however.
employ to reduce these risks.
PLANNINg A SuCCESSfuL PRoMoTIoN
Many promotions don’t run smoothly because companies
PRoMoTIoNS LAwS
fail to identify risks and plan accordingly. You can
All 50 states prohibit companies from running chance-based
reduce your risks by taking the steps outlined above and
promotions in which consumers are required to make a
responding promptly to complaints. Also keep in mind that
payment or purchase. And although it may be lawful in
because these promotions are relatively new, there are still
many states to require a purchase or payment for a skill-
a lot of legal uncertainties. Pay close attention to changes
contest, there are a number of states with broadly-worded
in the legal landscape and be prepared to respond quickly.
statutes that could restrict such a requirement. Therefore,
Gonzalo E. Mon is an attorney in Kelley Drye & Warren’s Advertising and
companies should pause and evaluate these restrictions
Marketing Law practice. You can reach him at gmon@kelleydrye.com or
202.342.8576.
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