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Last month, a federal district court in Detroit refused to dismiss a putative class action lawsuit filed against Dunham’s Athleisure Corporation (“Dunham’s”) concerning the regional sporting goods retailer’s sweepstakes sponsorship and marketing practices, reinforcing the importance of consulting an experienced sweepstakes lawyer when formulating and/or sponsoring a promotional contest or sweepstakes.

How can a sweepstakes lawyer help keep promotions legally compliant?

Sweepstakes and Promotional Contests

Dunham’s sells athletic equipment, sports apparel, footwear and other sporting goods at over 230 Dunham’s Sports stores throughout the Midwest.

As a marketing vehicle for its sporting goods sales, Dunham’s sponsors a variety of online promotional contests and sweepstakes. Prizes and giveaways have included free sporting goods, sports tickets, trip packages and Dunham’s gift cards and products.

Sweepstakes Lawsuit

In May 2016, Michigan resident Abdul Hamza sued Dunham’s in the U.S. District Court for the Eastern District of Michigan (Case No. 16-cv-11641) for alleged violations of the Telephone Consumer Protection Act (“TCPA”). Mr. Hamza’s putative class action complaint claims that Dunham’s delivered thousands of unsolicited promotional text messages to consumers’ mobile phones.

Dunham’s claims that Aisha Hamza entered one of its sweepstakes promotions in February 2016 and, at that time, opted into Dunham’s promotional text messaging program using Mr. Hamza’s mailing address and telephone number.

On March 22, 2017, the Court denied in part Dunham’s motion to dismiss the lawsuit, finding that Mr. Hamza had alleged sufficient violations of the TCPA. Since that time, Dunham’s has filed a third-party complaint against Ms. Hamza for alleged fraud, asking the Court to enter judgment against Ms. Hamza in an amount equal to any sums Dunham’s is required to pay Mr. Hamza.

How a Sweepstakes Lawyer Can Help

When administered effectively, promotional contests and sweepstakes have the potential to create a lot of buzz (and revenue) for the sponsor. However, as the above-referenced case demonstrates, sweepstakes sponsors may also find themselves facing substantial legal liability.

Many sweepstakes-related legal risks can be minimized or eliminated entirely by working with experienced marketing counsel before sponsoring a promotion. Well-planned promotions can help protect contest and sweepstakes sponsors from substantial liability. Additionally, a sweepstakes lawyer can help promotion sponsors address a number of other legal concerns related to contest rules, advertising, consumer privacy, bonding requirements and other areas of compliance.