Publishers Clearing House recently settled with 32 state attorneys general who alleged that Publishers' marketing practices mislead consumers into believing that purchasing magazine subscriptions and other products would increase their chances of winning Publisher's sweepstakes. The state attorneys general alleged that Publishers violated a 2001 settlement agreement in which Publishers had agreed to a variety of restrictions on the manner in which it promotes its sweepstakes. To settle the most recent claims, Publishers agreed to pay $3.5 million and to change language in its advertising that allegedly suggested that the chance of winning a Publishers' sweepstakes is improved by purchasing various Publisher's products. In addition, Publishers has agreed not to send communications from the "Board of Judges" to indicate that the recipient is close to winning a prize and not to tell recipients that their entry code has a "key code" for the winning entry.

TIP: Ensure that advertising for your promotions does not imply that purchasing a product will increase the odds of winning a sweepstakes prize and that your advertising does not overstate a receipient's chances of winning.