Sale of silverware through plan involving lottery rejected

No. 87. Sale of silverware through plan involving lottery rejected.

The Commission issued an advisory opinion today (with Commissioner Elman not concurring) in which it disapproved a si1vcrware manufacturer s plan because it involved the sale of merchandise by means of a lottery.

Under the terms of the proposed plan , advertisements wi1l be published inviting the reader to complete a contest entry form ,

ADVISORY OPINION DIGEST 1869 specifying his preference among certain flatware featured there, together with his name and address. The reader wiJ be invited to leave said form with the manufacturer s dealer or in lieu of using the form featured in the advertisement, he can obtain the same form at his dealer or print the same infonnation on a blank piece of paper and leave it with the dealer. At the conclusion of the eon test, each dealer wiJ draw the name of one contestant who wi11 receive a free 4-piece place setting in the pattern specified on his entry form. There is absolutely no requirement on the part of any participant or winner to purchase or promise to purchase any merchandise. However, the rules further provide that if the winner purchased other settings in his particular pattern during the period of the eon test, the dealer wi11 donate additional pieces in that pattern equivalent in retail value to those purchased. In its advisory opinion, the Commission took the position that the portion of the plan which awards a 4-piece place setting to the winner is unobjectionable, However " the Commission added the matching provision on the part of the dealer creates the element of consideration on the part of participants and therefore constitutes the sale of merchandise by means of a lottery or by means of a chance or gaming device contrary to the provisions of Sec. 5 of the FTC Act. As a result, the Commission cannot give its approval to this aspect of your proposed plan in its present form. " (File No. 663 7063, released Sept. 2, 1966.