Sweepstakes Law and Legal Definition

A sweepstakes is a legal contest or game where anything of value is distributed by lot or chance. Federal legislation and state laws govern sweepstakes. The federal "Deceptive Mail Prevention and Enforcement Act" prohibits the mailing of deceptive material relating to sweepstakes, skill contests, facsimile checks, and mailings made to look like government documents.

The Act requires certain disclosures and is limited to mailed solicitations which provide an opportunity to enter a contest or sweepstakes. It only applies to sweepstakes literature that is mailed. Mailings that only provide general information on a contest or sweepstakes rather than an opportunity to enter are not subject to these disclosure requirements. Advertisements in newspapers, magazines and other periodicals are also not affected provided that the ad is not directed to a specifically named person and the ad does not offer an opportunity to purchase a product or service. Some of the other requirements provide that the mailings must provide information on being removed from the mailing list, they may not falsely claim the person has won something, and must not claim that the person will excluded from future sweepstakes mailings unless they make a purchase.

The following is an example of a state statute regulating sweepstakes:

  1. " It shall be unlawful for any person to solicit or sell a product or service through the mail by implying or expressly representing in the solicitation that the person being solicited has won or has been selected to receive a prize or purported prize unless the qualifying language appears in print that is clear, easily read, and conspicuous.
  2. A person who suffers damage as a result of a violation of subsection (a) may bring a civil action against the sponsor or promoter of the solicitation, or both. Damages shall not exceed three times the compensatory damages of the party claiming punitive damages or five hundred thousand dollars ($500,000), whichever is greater."