It pains me to see how many Californian bloggers are not following state laws when doing giveaways. These are actual laws that carry an average fine of $2500 per an offense for failure to comply, and some offenses can land you jail time.
When I have taken the time to point out violations to help bloggers I have heard the excuse of “I am a newbie to blogging / giveaways” or “I didn’t know.” Few then comply, most go on without changing a thing, doing giveaway after giveaway ignoring California state laws. Several times I have heard “well the sponsor wanted me to do it that way.” If that is the case, ask yourself if that is same sponsor who signed off to pay your legal fees or fines to fight the California Department of Consumer Affairs?
Stephen Hawking’s once said “The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge.” It is up to the blogger to understand the legalities and to comply. Do not leave it to the sponsors to teach you, and do not get your information from questionable sources. Become familiar with the California Legal Guides / Business and Professions Code sections that pertain to giveaways. Below I have broken down which are the most important sections, and what could happen if one fails to comply. Please note that this is just the regulations from the California Department of Consumer Affairs regarding giveaways, every blogger should also understand FTC Guidelines when doing giveaways some that can be read here.
| Legal Guide | Code Sections | Failure to Comply | |
|---|---|---|---|
| Legal Guide | Code Sections | Failure to Comply | |
| Rules For Operation of Contests and Sweepstakes | U-3 | 17539-17539.3, 17539.35 | Any person who violates the provisions on operation of contests or sweepstakes is guilty of a misdemeanor,38 and may be prosecuted by the Attorney General or by a district attorney. These provisions also are enforceable by civil court actions which can be filed by private parties, district attorneys, city attorneys, county counsel, the Attorney General and other agencies of the State. Depending on the nature of the action, remedies may include civil penalties of up to $2,500 for each violation, injunction, and restitution. A contest or sweepstakes which violates these provisions also may be subject to an additional civil penalty of up to $2,500 for each violation as an unlawful business practice. |
| Rules on Conditional Offer of Prizes or Gifts | U-4 | 17537 | The misdemeanor provisions are enforceable by the Attorney General or by any district attorney. Section 17537 also may be enforced through civil court actions filed by private parties, district attorneys, the Attorney General and other agencies of the State. Depending on the nature of the civil action, remedies include injunction, restitution, and civil penalties of $2,500 for each violation. A conditional offer which violates the provisions described herein also may be subject to an additional civil penalty of up to $2,500 for each violation as an unlawful business practice. A court in a civil action brought by a recipient may award him or her treble damages (three times actual damages) against an offer or who has violated the provisions on conditional offers of prizes and gifts. The court may also award reasonable attorneys fees to the prevailing party. |
| Rules For Promotional Giveaways | U-1 | 17533.8, 17537.1, 17537.2, 17537.4 | An offeror who violates any of the foregoing provisions is guilty of a misdemeanor. (Bus. & Prof. Code § 17534.) The provisions described in these sections are also enforceable by the Attorney General, district attorneys, city attorneys, and certain agencies of the state. Remedies include civil penalties of up to $2,500 for each violation, injunction, and restitution. (Bus. & Prof. Code §§ 17535, 17536.) Violation of these provisions may also subject the offeror to an additional civil penalty of up to $2,500 for each violation as an unlawful business practice. (Bus. & Prof. Code §§ 17200, 17206.) If the recipient of an offer which is subject to Business and Professions Code section 17537.1 is damaged by a violation of the provisions described above, the recipient may bring a civil action for treble damages against the offeror. The court in such an action may award attorney's fees to the prevailing party. (Bus. & Prof. Code § 17537.4.) Private parties who have suffered an injury in fact may also enforce these provisions in an action for injunctive or other equitable relief under Business and Professions Code sections 17535, 17200, 17203 and 17204. |
Reference – California Department of Consumer Affairs
Okay, I looked through the CA laws, and this stuck out to me:
“offers an incentive to a recipient to induce the recipient to attend a sales presentation, contact a sales agent, or visit a location, must disclose the following, in writing, in the offer — clearly, conspicuously, and intelligibly”
as being the instigator of the regulations and requirements of what to post (i.e. winning odds, business addresses, purpose of visit, restrictions, etc). I am one of those people that is new to giveaways, so this is confusing to me. Is asking someone to “like” a page for an additional entry on Rafflecopter or whatever the same as a participant contacting a sales agent? Because it is an optional entry does that count? If it does, and the odds depend on the # of participants and entries, how do I disclose that information?
Thoughts?
Please note I am not a lawyer and his is only my interpretation and not used as legal advice. Best would be to contact a lawyer who specializes in this area to get accurate advice.
Here is my interpretation
You can have someone “like” your page or check in to a location to enter your promotion, but that’s it. You can’t force them to like a wall post, post a newsfeed, invite friends, update their status, etc. You can ask them nicely to help share your promotion, but you cannot require them to, or give them added incentive to.
I hate to say, as I am reading this, that I dont really know what this means. If I DONT have a lawyer, I kinda feel like I shouldnt do giveaways at all!!…How do I comply with all of the rules?