Class Action Against Trump Exposes Risks Using Premium SMS For Sweeps Entries

A Georgia class action filed by an individual who played "Get Rich With Trump"-- a companion game to the popular "The Apprentice" television show -- by entering via a premium SMS, illustrates potential risks utilizing entry methods that have a fee associated with the use. Depending on how the suit turns out, the future of games utilizing SMS and other interactive channels, which include the payment of a fee as one potential method of entry, may be in jeopardy in at least certain states.

The Trump action

"Get Rich With Trump" is an interactive sweepstakes that viewers can play while watching the NBC show – The Apprentice. As part of the game, viewers vote as to which of the apprentice candidates on the show should be sent to "Tent City" by either sending a premium SMS (Short Message Service – a text message service that enables users to send short messages typically through cell phones) costing $.99 plus any applicable standard text messaging rates or by entering for free via the Internet. At the end of each show, a $10,000 grand prize winner is randomly selected by the sweepstakes administrator, and other prizes are randomly awarded. In February 2007, Cheryl Bentley, on behalf of herself and all other Georgia residents who paid to play the game, filed suit in Georgia state court against Donald Trump, NBC, and the entities involved in either the production of the television show or the running of the game. Ms. Bentley has charged defendants with engaging in a pattern of racketeering activity by promoting a lottery and seeks an injunction barring the operation of the game in Georgia, a rescission of all charges placed on all Georgia users’ cell phone accounts, and an accounting of all such charges.

The basis of plaintiff’s illegal gambling charge is a claim that defendants were operating an illegal lottery. A lottery has three elements – prize, chance, and consideration (typically the payment of money), and private individuals and businesses are prohibited from conducting one. Here, Ms. Bentley alleged that the Apprentice game is a lottery because of the existence of a $10,000 prize selected solely on a random drawing in which persons can enter by paying a premium SMS charge, because individuals who paid to enter failed to receive any product or service in return for the premium SMS charge other than the entry into the sweepstakes.

What is significant here is that the defendants are being charged with gambling when the game offered eligible entrants the option of entering for free – via the Internet – and non-paying entrants had the same chance of winning the same prize as paid entrants. Even though the game offered a free no purchase alternate method of entry, plaintiff alleges that the fact that some entrants paid to play warrants a finding that the game is a lottery under Georgia law. Indeed, at least one Georgia decision provides that for a game to constitute illegal gambling, it is only necessary that "among those persons who receive a chance to win a prize there must be some who have paid a consideration."

Given that cell phones and PDAs are rapidly replacing computers as the next generation of Internet communication devices, interactive marketers need to be consciously aware of the risks associated with having a method of entry that requires the payment of fees. It is unclear whether a similar lawsuit would have been brought if only standard SMS charges were applied. However, those involved in any SMS games in which prizes are awarded by chance should focus on providing paid entrants with something of value in exchange for the payment of the entry fee.

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