The Legal Side of Social Media Marketing - Cisca Brouwer

SOCIAL MEDIA
MARKETING:
THE LEGAL SIDE
multifamily-social-media.com
This presentation does not constitute legal advice or a legal opinion on any matter discussed. This presentation is for educational purposes only.

You Can Play on Third Party Turf…
Kellogg’s Amazing Spider-Man 2
Social Media (Facebook, Twitter and Google+) posts on 4/30 – 207,261 Impressions

Kellogg’s Man of Steel
Facebook: posting to 1.7MM Fandango Fans Twitter: 2 Twitter postings to 119k followers (238k total)

…or on Your Own Turf.

Agenda
•Overview of Key Applicable Laws
•Third Party Platform Requirements
•Promotions Law Quick Hit
•Content Considerations
•Charity/Cause Marketing

Key Applicable Laws
• Federal and State Consumer Protection Laws
• Copyright Law
• Trademark Law
• Right of Publicity Laws
• Lottery/Promotions Laws

Consumer Protection Laws
• Traditional consumer protections apply online and on mobile:
– FTC (see .com Disclosures and Guides Concerning the use of
Endorsements and Testimonials in Advertising)
– Lanham Act (Unfair Competition)
– National Advertising Division of BBB (NAD)
• Additional Guidelines:
– Trade Association Guidelines (DMA, WOMMA, MMA)
– IAB Guidelines (see IAB.net)
– Digital Guiding Principles for Alcohol Companies Engaged in Social
Media

FTC’s .com Disclosures
• If a disclosure is necessary to prevent an ad from being deceptive,
unfair or otherwise in violation of an FTC rule, and it is not possible
to make the disclosure clearly and conspicuously on a particular
platform, then that platform should not be used to run the ad.
• Disclosures should be as close as possible to the relevant claim.
• Avoid pop ups as they are often blocked.
• Label hyperlinks as specifically as possible and confirm they
function on all devices.
• Bloggers or other online publishers must disclose relationships with
advertisers when they receive free products for review,
compensation or other consideration.

FTC’s Guides on Endorsements
and Testimonials in Advertising
• Disclose any material connection
–Payment or other benefit
–Employee status
•Consumer endorsement must reflect typical consumer experience.
•If an endorsement suggests a person (including celebrities) uses a
product, the person must actually use the product and the endorsement
must accurately reflect the person’s experience.
•FDA views an advertiser’s “Like” of a third party’s social media post as
an endorsement of that post, including any claims made in the post.

Third Party Platform Requirements

Promotions on Facebook
Facebook Promotion Guidelines:
•Promotions on Facebook can be administered within Apps on Facebook OR on Page
Timelines, but NOT on personal Timelines.
•Facebook features can be used as the primary or automatic registration/entry
mechanism (excluding “like” feature).
•Recently updated Page Terms prohibit Pages from tagging or encouraging users to tag
themselves in content where they are not actually depicted.
– Example: It is permissible to ask users to submit names of a new product in exchange for a chance to
win a prize; however, it is not permissible to ask users to tag themselves in images of the new product
in exchange for a chance to win a prize.
•Promotions on Facebook must include the following disclosures:
– A complete release of Facebook by each entrant or participant.
– Acknowledgment that the promotion is in no way sponsored, endorsed, administered by or
associated with Facebook.
– Links to promotion’s Official Rules, Sponsor’s Privacy Policy and Sponsor’s Terms of Use for its
website.

Facebook Promotion Guidelines (cont.):
•Cannot use Facebook’s name, trademarks or other IP except as needed to comply with
the Facebook Promotions Guidelines.
•An option for ensuring compliance with the Facebook Promotions Guidelines is to
engage a third party developer that is certified by Facebook.
•Remember that complying with the Facebook Promotions Guidelines does NOT
guarantee that a promotion will be lawful.
•Sponsor must link to its own Privacy Policy where personal information is collected.
•Sponsor is responsible for the lawful operation of a promotion, including:
– The Official Rules
– Offer terms and eligibility requirements (i.e. age and residency restrictions); and
– Compliance with applicable rules and regulations governing the promotion and all prizes offered (i.e.
registration and obtaining necessary regulatory approvals).
•Sponsor can notify promotion winners through Facebook messages, chat or posts on
Timelines or brand pages.

Facebook Platform Policy Updates:
•Effective Nov. 5, 2014, Facebook revised its Platform Policy to restrict the use of its
“like” functionality. Page owners are no longer allowed to “like-gate” a promotion or
otherwise require a consumer to like a page to gain access to content via a Facebook
application.
•“You must not incentivize people to use social plugins or to like a Page…This includes
offering rewards, or gating apps or app content based on whether or not a person has
liked a Page.”
•However, marketers can still ask users to like a Page, as long as no incentive is
offered for liking the Page.
•Advertisers may still use other techniques to incentivize consumers to log in to an
app, check in at a place or enter a promotion on an app’s page.
•These changes do not affect Facebook’s Pages Terms, which continue to allow
marketers to administer promotions on a company’s Facebook page.

Facebook Rules
• Advertising Guidelines https://www.facebook.com/ad_guidelines.php
• Platform Policy https://developers.facebook.com/policy/
• Page Terms https://www.facebook.com/page_guidelines.php
• Website Terms https://www.facebook.com/legal/terms
• Privacy https://www.facebook.com/about/privacy/
• Principles https://www.facebook.com/principles.php

Promotions on Twitter
• Twitter Rules (https://support.twitter.com/articles/18311-the-twitter-rules)
• Twitter for Business (https://business.twitter.com/)
• Guidelines for Contests on Twitter (https://support.twitter.com/articles/68877-
guidelines-for-contests-on-twitter)
• Brand Policy (https://about.twitter.com/press/twitter-brand-policy)
Twitter Policies:
• Twitter Parties—specific hashtags
• Encourage use of #paidad, #ad, #paid, #sponsored, #sweeps, #contest or “Ad:” at
the beginning of the tweet (FTC requirement).
• Must tweet link to the full official rules and entry details.
• Follow each call to action with a tweet which includes required disclosures.

Promotions on Twitter (Cont’d)
• Discourage the creation of multiple Twitter accounts.
• Discourage posting of the same Tweet(s) repeatedly.
• Ask users to include an @reply to you in their update so that you can
see all of the entries.
• Encourage use of your hashtags with topics relevant to the promotion.
• Cannot use Twitter name or marks to imply sponsorship of promotion.
• Tip: Include language in the Official Rules notifying entrants that they
could be disqualified, and/or not receive notifications, if their privacy
settings prevent sponsor from seeing the entry or messaging the
entrant.

Promotions on Instagram
• Notify entrants that their privacy settings must be such that sponsor can see
entries and contact winners.
• Instagram for Business guidelines suggest best practices:
– Using hashtags to collect photos from your followers around a certain theme;
– Spread the word on other sites—website, Facebook, etc.
– Use Instagram API to pull photo streams into an official Instagram feed on
your website; and
– Pick a reward that appeals to your target audience.
– Get involved on Instagram to build familiarity with the app amongst your
customers/consumers; and
– Give it time—spread out the term to give users plenty of time to learn about
the promotion and create submissions.
• Instagram Promotions Guidelines https://help.instagram.com/179379842258600
• Instagram for Business http://blog.business.instagram.com/

Promotions on Pinterest
• Companies may now verify company-sponsored pages with a “website verification
badge” which is currently only available for top-level domains.
• Promotions and marketing are prohibited on individual user pinboards, pages and
Pinterest accounts.
• Similar to Facebook, Pinterest prohibits marketing or advertising materials from
suggesting that Pinterest is sponsoring the promotion or formally affiliated with
the promotion.
• The guidelines advise against running a sweepstakes where each pin, repin,
pinboard, follow or “like” represents an entry or vote due to functionality
limitations which inhibit accurate tracking of such types of entries.
• Complying with the Pinterest guidelines does NOT guarantee that a promotion will
be lawful.
• Pinterest Brand Guidelines http://business.pinterest.com/en/brand-guidelines
• Pinterest Acceptable Use Guidelines https://about.pinterest.com/en/acceptable-
use-policy

Promotions on Pinterest (Cont’d)
Best practices for running a Pinterest promotion:
–Include an acknowledgement that the promotion is in no way sponsored,
endorsed, administered by, or associated with Pinterest;
–Require entrants to mark submissions with a hashtag specifically designated for
the promotion;
–Avoid “spammy” behavior—reward quality over quantity;
–Don’t make entrants pin or repin promotion rules;
–Don’t limit eligible pins and/or pinboards to those utilizing only images from a
fixed or limited selection;
–Encourage entrants to monitor their entry boards for notices from promotion
sponsor; and
–Don’t require a minimum number of pins for promotion entry or ask for
comments.

Promotions on Google+ and Vine
Google+
• Google+ Contest and Promotions Policy prohibits contests, sweepstakes, offers, coupons or
other promotions from being run directly on Google+ or in a manner that requires use of
Google+ features/functionality (https://google.com/+/policy/contestspolicy.html)
• May display a link on Google+ to a separate promo site so long as the business (and not
Google) is the sole sponsor.
• Google reserves the right to remove any promotion content from a Google+ Page for any
reason.
• Promotions must comply with all Google policies and terms.
Vine (Twitter)
• Vine’s Terms of Service do not currently address the use of Vine in sweepstakes or contests
(https://vine.co/terms)
• Utilize Twitter best practices:
–Encourage the use of hashtags with topics relevant to the promotion; and
–Ask users to include an @reply to you in their update so that you have visibility of all
entries.

Promotions Law Quick Hit

Sweepstakes or Contest?
• A promotion that contains these three elements constitutes an illegal
lottery under federal and state laws:
1) Consideration (something of value provided by entrant)
2) Chance
3) Prize
• Remove any one of the three elements to run a legal sweepstakes or
contest.
• Sweepstakes: removes consideration. Random (chance) drawings for a
prize; free to enter.
• Contest: removes chance. Prize is awarded based on measurable skill.

What is Consideration?
• Giving up something of value to participate.
• Consideration examples:
– Ticket/product purchase
– Substantial effort or personal info required of the entrant
– Store visits
– Text messaging fees
• Typically not consideration:
– Postage (except in VT)
– Internet access
– Completing a simple entry form
– Opening a Twitter/Facebook/Instagram account
– “Liking” a Facebook Page
– Posting a comment or photo to a Facebook Page
– Retweeting a message
– “Following” an advertiser
• Avoid the consideration issue by providing an Alternate Method of Entry [AMOE] (e.g. a
postcard or email entry option).
• AMOE must be free, given equal chance at winning and clearly referenced in the rules and
marketing.

What is Chance?
• Winner(s) selected randomly; no control by participants over the
outcome.
• Eliminate chance by choosing a winner based on SKILL:
– Must be a bona fide skill (i.e. guessing the number of jellybeans in a
jar is NOT a skill);
– Questions cannot be too hard or easy;
– Ties must be broken on basis of skill and not random selection;
– Judging criteria must be objective and clearly disclosed in the Official
Rules;
– Judges must be qualified; and
– All entrants must compete on equal playing field.

What is a Prize?
• Anything of value provided to winners, including:
– Event tickets
– Consumer goods
– Promotional merchandise
– Trip
– Experience

Prize Restrictions
• California: no live animals
• Hawaii: no liquor prizes in public places
• Maine: no live animals and no liquor prizes if contest is held
by liquor license holder
• Massachusetts: no live animals
• Minnesota: no chicks, goslings, ducklings or rabbits that have
been artificially colored
• Nebraska: no real estate, raffle ticket or live animal except for
beef or dairy cattle, horse, bison, sheep or pig
• Pennsylvania: no live animals, except fish

Official Rules
• Every sweepstakes or contest needs official rules, regardless
of whether entry is via the Internet, on-site, text, social media
or any other form.
• Rules are the terms of the contract between the promotion
sponsor and the entrant.
• Rules must be clearly disclosed and made accessible prior to
promotion entry.
• Link to complete Official Rules and abbreviated rules must be
available prior to entry.
• No changes to the rules allowed after promotion begins.

Official Rules (Cont’d)
Official Rules should include:
•A provision that includes the following: No purchase necessary to enter or
win. A purchase will not increase chances of winning. Void where
prohibited.
•Clear entry instructions (list all methods of entry, deadlines, and limits on
entries).
•Ownership of entries and use of images and winner name/profile.
•Prize description, including approximate retail value (ARV) of each prize
element and total prize ARV.
•Any limitations or restrictions on the prize.
•Eligibility restrictions and qualifications.
•Promotion start and end dates/times.

Official Rules (Cont’d)
Official Rules should include (cont’d):
•Method of winner selection.
•Name and address of promotion sponsor.
•Website for privacy policy applicable to the entries.
•Odds of winning.
•Whether unclaimed prizes will be awarded and how alternates will be
selected.
•Disclaimers as to technical failures and prize liability—if sponsor determines
that the promotion is corrupted, then sponsor can select winner from
eligible entries already received and can terminate the promotion.

Registration and Bonding
• New York: promotions with total prizing exceeding $5,000 require registration and
bonding with the New York Secretary of State 30 days in advance of promotion
launch.
• Florida: promotions with total prizing exceeding $5,000 require registration and
bonding with FL Dept. of Agriculture & Consumer Services 7 days in advance of
promotion launch.
• Rhode Island: promotions with total prizing exceeding $500 require registration
with Office of the Secretary of State (no bond required).
• Arizona: An operator of an “intellectual contest or event” which requires purchase
to enter must be registered with the State Attorney General’s Office.
• To avoid registration and bonding requirements, you can exclude certain states
from promotion eligibility or keep the prize value under $500 or $5,000—you can
also structure a promotion as a series of consecutive sweepstakes with separate
entry periods and prize pools.

After the Promotion is over…
• Winner’s release or affidavit must be signed (some need
notary).
• If there is a guest portion of the prize, then the guest must
also sign a guest release and/or affidavit.
• Maintain a list of winners.
• Send winners list to states requiring these lists and have
bonds (if any) released.
• Send Form 1099 to winner if total prize is valued at $600 or
more.

Content Considerations
• Music Licenses and Performance Rights
• Third Party Trademarks
• Right of Publicity Laws
• UGC
• Who owns the content?

User-Generated Content (UGC)
• Will you moderate? Take down? What rights does your company have?
• A typical UGC-based promotion allows entrants to upload a photo, video, text or
music (which may or may not incorporate sponsor’s product) for a chance to win a
prize.
• Official Rules should note:
–Submission requirements (i.e. length/format)
–Reps, warranties and indemnification
–Right to use name, likeness and bio info
–Rights in submissions (ownership)
–Prohibition on submissions copyrighted or trademarked by a third party (3rd
party IP)
–Reserve right to remove or reject content for any reason

Charity and Partnerships

Charity Involvement/Cause Marketing
• When (1) the offer for sale of a product or service is (2) based on the
representation that the purchase will benefit a charity, a Commercial Co-
Venture (CCV) relationship is formed.
• CCV Basic requirements:
–Written contract with the charitable organization;
–Per-unit disclosure of donation amount;
–Disclosure of beneficiary; and
–Registration and bonding in certain states.
• Must follow Attorney General guidelines for CCV.

Thank you for attending today!
Cisca Brouwer
Senior Counsel
NBCUniversal Digital Entertainment
francisca.brouwer@nbcuni.com

The Legal Side of Social Media Marketing - Cisca Brouwer

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