Big Blue Fans Win Big Red Steaks: Promotions That Go Better (?) Than Expected

On Saturday (October 8), the University of Michigan eleven beat Rutgers by the lopsided score of 78-0. I don’t know if the Wolverines were fed red meat before the game, but the fans in Ann Arbor are sure lining up for some at the local Ruth’s Chris Steakhouse. Prior to the game, the restaurant posted on its Facebook page that from Sunday through Thursday it will offer a discount to match the winning point differential. The original post did not mention a cap, but was subsequently edited to limit the discount to 50% off the bill, excluding alcohol. A post after the game, indicated that the restaurant was booked through Thursday.

The timing of the additional restrictions may be problematic, but regardless, Ruth’s Chris Ann Arbor may have gotten more than it bargained for. There’s always that sweet spot that promotors are looking for to generate traffic without breaking the bank, and thanks to an historic performance by Big Blue, it’s possible that Ruth’s Chris Ann Arbor’s promotion could put it in the red. (more…)

Is It Really “The Best [Insert Product] You Ever Bought?” Amazon Limits Incentivized Reviews

When shopping online, we all want to know what lawnmower/backscratcher/egg timer is the best. Once we’ve found an array of options, many of us go right to the online reviews to see how others liked the product. Caveat emptor be damned, Ralph from Bensonhurst just loved the Handy Housewife Helper, so I want one too. Little did we know that Ralph and his partner Ed were trying to unload 2,000 of these gadgets to the unsuspecting public.

To help bolster the legitimacy of online reviews, yesterday (October 3, 2016) Amazon announced an Update on Consumer Reviews explaining that it has updated its community guidelines to prohibit incentivized reviews unless they are facilitated through the Amazon Vine program. (more…)

U.S.A! U.S.A.! – House Votes to Eliminate the “Victory Tax” on Olympic Prizes

Olympic prize awards are generally taxed like other prizes. Some lawmakers have seen this practice of taxing our Olympians as a “victory tax.” On Thursday (Sept. 22, 2016), the House of Representatives overwhelmingly passed a bill exempting U.S. medal winners from paying taxes on the money they receive from the U.S. Olympic Committee when they earn a medal. U.S. Olympians are paid $25,000 for gold, $15,000 for silver and $10,000 for bronze. A similar bill passed the Senate in July, and President Obama is expected to sign the bill into law. (Just so the bill doesn’t sound too favorable to big-time athletes, winners who earn more than $1 million per year can’t take advantage of the tax break.)

Where does this leave the average Joe or Jane prize winner? “Win a New Car” and you could end up paying a hefty tax before you get behind the wheel. (And no, it’s not a “gift” exempt from taxes.) There are plenty of instances where prize winners simply decline a valuable prize or donate it to charity to avoid paying taxes. “Taxes are responsibility of winners” is rightly in Official Rules, but who really thinks of that when they enter a sweepstakes for a trip of a lifetime? (more…)

There’s No Such Thing as a “Free” Sample: FTC Provides Guidance on Advertising “Free” Samples Combined with Recurring Charges

On Tuesday (September 20, 2016), the FTC and Nutraclick entered into a consent order concerning Nutraclick’s online offer for “free” samples of supplements and beauty products. The FTC alleged that Nutraclick failed to clearly disclose to people who requested the samples that they would be enrolled in a membership program and billed up to $79.99 per month, unless they canceled within an 18-day trial period. While this promotional offer may have netted significant profits, its success was short-lived when at least 70,000 filed complaints prompting the FTC investigation.

The FTC alleged violations of the FTC Act’s prohibition against unfair or deceptive acts or practices (15 U.S.C. §45(a)) and the Restore Online Shoppers’ Confidence Act, which pertains to selling online through a negative option feature, i.e., where a consumer’s silence is interpreted as an acceptance of the offer. 15 U.S.C. §8403.

The Promotion (According to the FTC Complaint): (more…)

Court Says Too Bad to Bad Online Reviews

Yesterday, the Ninth Circuit Court of Appeal dismissed a lawsuit against Yelp! by a disgruntled business that received a one-star rating from a customer, upholding the protection provided to online providers under the Communications Decency Act (CDA).

Douglas Kimzey, the owner of a locksmith business, received a review from “Sarah K” in 2011 stating, in part, “THIS WAS BY FAR THE WORST EXPERIENCE I HAVE EVER ENCOUNTERED WITH A LOCKSMITH.  DO NOT GO THROUGH THIS COMPANY.” (All caps in original). And she gave the company a one-star rating. One-year later, the company posted a comment under Sarah K’s review, stating “Yelp has posted a fraudulent review on our business” and posted a link to essentially the same “review posted about a fraud operation” of a similarly named company. Game on! Sarah K then posted an updated review confirming that she dealt with, and meant to review, Mr. Kimzey’s company and had “the receipt to prove it.” (more…)

Playing for Keeps: Daily Fantasy Football 2016

When the last online fantasy football game was played, the attorneys general of New York, Nevada and Illinois were throwing penalty flags, state legislators was huddling to set the next play, and the daily fantasy sports leagues were taking it on the chin.

Where are we now? Here’s a 50 state survey:

DFS expressly allowed: CO, IN, KS, MD, MA, MS, MO, NY, RI, TN, WV, VA

Contested: AL, DE, GA, HI, ID, IL, NV, SD, TX

Banned: AZ, IO, LA, MT, WA

Proposed legislation: CA, CT, FL, KY, MI, MN, NE, NJ, NM, OK, PA, SC, WI

No legislation: AS, AK, ME, NH, NC, ND, OH, OR, UT, WY

How about this stat: leading up to the 2015 NFL season, daily fantasy sports leagues spent over $750 million in ads – more than the entire beer industry. In 2015, the top two companies had recorded a combined $3 billion in player entry fees. (more…)