Special Alert

The New York Department of State Games of Chance office ("DOS") has recently denied registration for several sweepstakes where the sweepstakes official rules may not have clearly specified that prizes will be awarded in the event of cancellation.  According to the DOS office, sweepstakes rules may not indicate that prizes will not be awarded, for any reason.  If the sweepstakes sponsor reserves the right to terminate the promotion, for any reason, including technical failures or corruption, the official rules must state that prizes will be awarded and how the winner(s) will be determined.  After further clarification with the DOS office, it appears that if official rules contain language similar to the following "sponsor may cancel, modify, or terminate the sweepstakes in the event or fraud, corruption or technical difficulties that prevent the proper administration of the sweepstakes," then the rules must also specify that the "sponsor will select winner(s) from all eligible, non-suspect entries received prior to such action."  Official rules that contain such language are likely to conform to the state's legal requirements.

TIP:  If an entity's sweepstakes rules allow the sponsor the right to cancel, modify, or terminate a sweepstakes, the sweepstakes rules should specify that prizes will be awarded and how the winner(s) will be determined in the event of such action.