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Legality of Texting Contests Questioned

Jun 24, 2007  •  Post A Comment

For a few seasons, it looked like TV producers had tapped into the mobile mint of premium text messaging as they encouraged viewers to win money by voting for their least favorite Donald Trump wannabe or enter other contests via cell phone. Those types of promotions are being challenged in a class-action lawsuit against “The Apprentice,” “Deal or No Deal” and “One vs. 100,” alleging the mobile games constitute illegal gambling.
The suits, which are pending in federal court in Los Angeles, point to the lack of legal clarity when it comes to nascent marketing technologies — and to just how careful media companies and marketers must be to ensure their promotions fall within the law.
The lawsuits attack the games on the grounds that they charge viewers a 99¢ premium text-messaging fee to participate, a violation of what is known as the Standard Lottery Rule. That fee is on top of the basic text-message fee. The producers, the network and the cell phone carrier split the revenue.
For the contests to be considered lotteries, and therefore illegal, three elements must be present: a prize, chance and consideration — which means something of value is required in order to participate (this is more commonly known as a bet). The 99¢ charge to enter, the suit said, technically makes the games illegal lotteries. The plaintiffs are demanding an injunction against the games, as well as attorneys’ fees and their 99¢ back.
The lawsuits for “Deal” and “Apprentice” were both filed and dismissed in Georgia and re-filed, along with the “One vs. 100” lawsuit, in federal court.
Abbey Klaassen contributed to this report.

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