Rules of the Games
Digital promotions present a unique combination of compliance-related issues, especially regarding sweepstakes, contests and games. Vendors of digital promotions must pay close attention to the Official Rules, relevant privacy policies and Federal Trade Commission (FTC) regulations, as well as various state laws. Suffice to say that digital promotions present a complicated web of regulations and enforcement opportunities. The fluid regulatory environment must be continually monitored. Note a recurring theme in all three areas: disclosure.
The Official Rules do more than detail the terms and conditions that the public must follow to participate in the promotion. Full disclosure is essential to defeat a claim of consumer fraud. As long as the terms, conditions and operations of the promotion are plainly and thoroughly described in the Official Rules, it will be difficult for any participant to claim that he or she was misled. The Official Rules also provide a type of “tech spec” (technical specifications) or reference against which the vendor’s technology must operate, and top digital promotions vendors scrutinize the Official Rules for the purpose of technology development.
Most companies that have an online presence also have posted privacy policies. In general, the primary purpose for a written privacy policy is to disclose to the public the policies describing the type of information collected from visitors and how that information is used. Some companies include specific statements about promotions in their privacy policies, but others do not. Capable digital promotions vendors pay close attention to the sponsor’s privacy policy to ensure the promotion is compliant. No changes to the privacy policy should be made during a promotion, and the technical staff should make no decision without approval from legal counsel. You might be surprised by the frequency with which both of these circumstances arise.
The difference between a scam and an honest mistake can be minor from the perspective of a governmental enforcement agency. The first priority is to rely on bold and complete terms and make obvious any significant information that could be easily overlooked or misunderstood by the public. Government regulators are likely to view the lack of disclosure as a sign of shady business, and you should assume that any confusion is not likely to be resolved in your favor. The second priority is to retain a law firm with extensive experience in advertising and promotions to navigate the regulatory landscape. Legal fees are an additional cost, but they pale in comparison to the cost of a confrontation with the government and its unlimited resources.
