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I am looking to do a "truck Giveaway" that involves my

I am looking to do...
I am looking to do a "truck Giveaway" that involves my youtube audience. However, the way people would enter is buy purchasing merchandise on my website and every $20 they spend on products gets them an entry into the drawing to possibly win. I would like to make sure its legal first of course. I guess it could be considered a gamble, but kinda not... Everyone gets whatever products they purchase from me. There is just an added bonus that those names will be put into a drawing to possibly win a truck as well. Is this legal in the state of Indiana? Or what steps must I take?
Thanks,
Malachi.
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Answered in 22 hours by:
1/21/2018
Dwayne B.
Dwayne B., Attorney
Category: Business Law
Satisfied Customers: 34,389
Experience: Practicing for over 20 years and helped a number of businesses with litigation.
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Hello and thank you for contacting us. This is Dwayne B. and I’m an expert here and looking forward to assisting you today.

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Please allow me several minutes to read your facts and type my response both initially and when you add a follow up question or add facts. Please don't ask "are you there", "where is my answer", etc., since when you post it can erase what I am working on. If we are having a conversation unless I tell you I am going offline, I will be here but I may be doing research.

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Since you are involving a YouTube audience it makes this question very, very, VERY hard to answer because no one that I know of keeps up with every slight variation in every state's gambling laws at all times. I did the research on this issue a few months ago and can give you the general overview of the law and it should still be accurate but just be aware that if you want someone to actually go in and evaluate all 50 states one by one it will cost you thousands of dollars in research fees.

Do you want me to continue with the overview based on what I believe is the current state of the law?

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Customer reply replied 1 month ago
I definantly don't want to spend thousands of dollars... But I know many YouTubers that do giveaways all of the time... But only a few that of done vehicle giveaways. Now of course I can't let anyone from around the world enter because I don't want to put up with laws outside of the US... But is there a way I can word the giveaway or use certain disclosure to get around saying its a lottery? or "Pay to enter giveaway"? So I'm protected against any weird lottery laws across the states? Because I already sell merchandise as it is for income. Is there some way I can do it this way? For example... "We are gonna continue selling merchandise like we always have... However, Since I don't have anyones contact info on YouTube or know names, ages, addresses, ect... I can only choose from the names who have placed orders I my system." Instead of saying "I'm doing a truck giveaway! YOU HAVE TO PAY TO ENTER! Its a raffle! It's a lottery! ect..." just avoid certain phrases and words and do it a way that technically makes me in the clear. I know there ARE ways to do it... I know lots of people that have on YouTube with no issues... In all honesty I could probably do it and still be in the clear and not get into trouble... But I wanna have something professionally written up disclosing it, that makes it legal if done correctly. Hope that isn't too complicated... Could this work? Thank You.

You aren't supposed to make it a "pay to win" since that makes it gambling and can create a ton of problems for you.

Most people on YouTube who conduct contests like this do them illegally, just like all of the online poker sites that were operating a few years ago were operating illegally.

A contest is, strictly speaking, a game of skill, such as an essay contest, a trivia game, a sales volume award, or an athletic competition, where the outcome is determined by some factor other than chance. Contests are lawful in NV, BUT they are subject to a myriad of federal laws and regulations, including postal service regulations, broadcast restrictions, trademark and copyright laws, and the Federal Deceptive Mail Prevention and Enforcement Act of 1999 concerning misleading and fraudulent sweepstakes and contest offerings. Further, the FTC's authority to regulate unfair or deceptive trade practices extends to games of skill and chance. Finally, there are applicable laws from the 50 states, which vary considerably and can be quite onerous. Generally, however, there are four basic legal requirements for contests and sweepstakes:
1. The promotion must not be an unlawful lottery. A supposed contest is an unlawful lottery when all three of the following elements are present: (i) a prize is awarded to the winner(s), (ii) the selection of a winner(s) is random or by chance, and (iii) entrants must pay or provide consideration for entry. Almost all sweepstakes include the first two elements (prize and random drawing). The presence or absence of consideration paid by participants for entry typically determines the legality of the promotion. Certain states have determined that the requirement of any type of consideration by entrants that would be sufficient to support a contract renders the promotion unlawful. This is the minority view maintained by only a few states. The majority view is that the requirements for participation must represent true value or necessitate significant effort to constitute "consideration." Games of skill avoid the second element (chance) and may require payment or other consideration without running afoul of state anti-lottery laws. Games that combine chance and skill (such as poker) exist in a regulatory gray area.

2. The overall promotion must be fair, non-biased and non-confusing. The sponsor must actually award the prize described, the winner cannot be preselected or chosen because of an affiliation with the sponsor, and all advertisements and representations must be accurate and not misleading in any way.

3. Certain disclosures must be made in the official rules, advertising, and promotions. While these disclosures vary by state, all material terms and conditions must typically be set forth in the "Official Sweepstakes Rules" which may be presented in print or online. The statement, "No Purchase Necessary," should accompany each and every description of the promotion. The disclosures should also include the prize description, the approximate retail value of each prize, the number of prizes awarded, the odds of winning (typically stated as "the odds of winning depend upon the number of valid entries received"), the start and end dates for entry, what is required for entry, the method or means for entry, eligibility requirements for entry, dates for claiming and using the prize, how and when the winner will be selected and notified, where the drawing will be conducted, the identity of the sweepstakes sponsor, and all other restrictions, limitations, and requirements of the promotion.

Games of skill also require disclosure of the number of rounds involved, the criteria for winning, the qualifications of the judges, and the costs for entry into each round. Many games of skill provide that, in the event of a tie, the winner will be selected by drawing lots. Such a provision turns the promotion into a game of chance rather than skill and no consideration can then be required for entry.

When travel is awarded, the disclosures should specify whether airfare, meals, lodging, ground transportation, taxes, resort fees, etc. are included, and any excluded properties, availability restrictions, and/or black out dates. That said, the restrictions should not be so onerous as to make it overly burdensome for the winner to redeem the prize. Promoting "prizes" that would require significant expenditure by the putative winner (such as a free airline ticket conditioned upon booking a specified number of nights at a specific hotel) should be avoided if possible.

4. Before advertising and conducting contests and sweepstakes, the promotions and supporting materials must be registered in accordance with the various state laws of EVERY state, since you are on the internet reaching each and every state and you will need to check the laws of each state by contacting the State Attorney General's offices in each state. For example, a contest must be registered under the laws of New York and Florida if the value of the prize exceeds $5,000, and in Rhode Island if the value exceeds $500 for example and you need to check each state law to determine their regulation since you are running this on the internet. Registration of such a promotion requires payment of a fee and submission of the contest rules and advertising, and may necessitate posting a bond in the state.

Remember, just because someone else is doing it doesn't ,mean it is legal, often it just means they haven't been caught yet.

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Customer reply replied 1 month ago
This makes much more sense... THANK YOU. Because, there is a big diesel truck giveaway place called "Diesel Sellerz" and they do truck giveaways often. They do almost everything you listed as the correct way to do it. They include all dates, values of prizes, description of prizes, travel costs they do and don't provide, all states allowed and not allowed for certain reasons. They also do the giveaways where people receive entries like I've stated (every "$$" spent gets them an entry. BUT, they don't just draw one name and thats the winner. They choose a few "potential winners" then do a competition between the 4-5 guys who run the gig and each guy is challenging the others, representing one of the names they drew. Whoever wins the challenge they set up, wins the vehicle. So its not just chance in a way, its whoever preforms the best. They have a page of disclosures that are about just like you stated here, just referring to their whole situation of course. But if I did this the way they do, or kinda like that... Would I then be able to do this? They also have a list of states and countries in North America that are and are not able to enter for their own reasons.. I would imagine I would probably want to follow those similar guidelines for the reasons they provide. You have been of good help, thanks.

You should be able to do it like they do it and be safe. The problem with the internet is that if anyone can see the ad anywhere and you don't specifically state their area is not eligible then you have to meet their laws. Plus, with the Obama administration's AG office they were trying to work a way to not charge people with violating gambling laws. The poker sites got into trouble not for gambling, but for "laundering money" because they were running the money through a variety of other corporations. The Trump administration, however, is extremely beholding to casino interests and I suspect they are going to start prosecuting these type of "crimes" if they can ever stop being investigated themselves. He's not going to worry about money laundering crimes but he will worry about anything that interferes with casino operations. That's just my opinion but one I am pretty confident about.

If your question has been answered then I'd offer my best wishes to you and ask that you please not forget to leave a 5 Star Positive Rating so I receive credit for my work. Also please consider clicking "BONUS" as a nice way of saying "thanks" for a job well done, although this is neither required nor expected. Of course, please feel free to ask any follow-up questions in this thread. I want to be sure all of your questions are answered.

Dwayne B.
Dwayne B., Attorney
Category: Business Law
Satisfied Customers: 34,389
Experience: Practicing for over 20 years and helped a number of businesses with litigation.
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Customer reply replied 1 month ago
I will do that! Thanks you!

Thank you very much for allowing me to assist you. While the answers I give can't always be "good news", since the law can't always be favorable to everyone, I do strive to be as accurate as possible and to answer any follow up questions to the best of my ability.

You may receive a survey of some kind in the next day or so regarding your experience here at JustAnswer. Please be advised that I am responsible for the content of my answers but not with the issues of website performance or anything other than the answer. I hope that you will consider issuing a Positive Rating regarding my service to you so that I can continue helping others.

If I can ever provide assistance to you in the future please feel free to ask for me by starting your new question with "FOR DWAYNE B ONLY" and I will pick up as soon as I see the question.

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