50-692. Prize notification; definitions; requirements of notice and solicitation; violations.
50-692
50-692. Prize notification; definitions;requirements of notice and solicitation; violations.(a) As used in this section:
(1) "Prize" means a gift, award or other item or service of value.
(2) "Prize notice" means a notice given to an individual in this statethat satisfies all of the following:
(A) Is or contains a representation that the individual has been selected ormay be eligible to receive a prize.
(B) Conditions receipt of a prize on a payment from the individual orrequires or invites the individual to make a contact to learn how to receivethe prize or to obtain other information related to the notice.
(3) "Solicitor" means a person who represents to an individual that theindividual has been selected or may be eligible to receive a prize.
(4) "Sponsor" means a person on whose behalf a solicitor gives a prizenotice.
(5) "Verifiable retail value" of a prize means:
(A) A price at which the solicitor or sponsor can demonstrate that asubstantial number of the prizes have been sold by a person other than thesolicitor or sponsor in the trade area in which the prize notice is given.
(B) If the solicitor or sponsor is unable to satisfy paragraph (A), no morethan 1.5 times the amount the solicitor or sponsor paid for the prize.
(b) If a solicitor represents to an individual, by oral or writtencommunication, that the individual has beenselected or may be eligible to receive a prize, the solicitor shall notrequest, and the solicitor or sponsor shall not accept, a payment from theindividual in any form and the solicitor shall not create the reasonableimpression that such payment is required before the individual receives awritten prize notice that contains all of the information required undersubsection (c)(1) presented in the manner required under subsection (c)(2)through (6).
(c) (1) A written prize notice shall contain all of the followinginformation presented in the manner required under paragraphs (1) through (6):
(A) The name and address of the solicitor and sponsor.
(B) The verifiable retail value of each prize the individual has beenselected or may be eligible to receive.
(C) If the notice lists more than one prize that the individual has beenselected or may be eligible to receive, a statement of the odds the individualhas of receiving each prize.
(D) Any requirement or invitation for the individual to view, hear or attenda sales presentation in order to claim a prize, the approximate length of thesales presentation and a description of the property or service that is thesubject of the sales presentation.
(E) Any requirement that the individual pay shipping or handling fees or anyother charges to obtain or use a prize.
(F) If a receipt of the prize is subject to a restriction, a statement thata restriction applies, a description of the restriction and a statementcontaining the location in the notice where the restriction is described.
(G) Any limitations on eligibility.
(2) (A) The verifiable retail value and the statement of odds required in awritten prize notice under paragraphs (1)(B) and (C) shall be stated inimmediate proximity to each listing of the prize in each place the prizeappears on the written prize notice and shall be in the same size and boldnessof type as the prize.
(B) The statement of odds shall include, for each prize, the total number ofprizes to be given away and the total number of written prize notices to bedelivered. The number of prizes and written prize notices shall be stated inArabic numerals. The statement of odds shall be in the following form:"____(numberof prizes)____ out of _________ written prize notices."
(C) The verifiable retail value shall be in the following form: "verifiableretail value: $______."
(3) If an individual is required to pay shipping or handling fees or anyother charges to obtain or use a prize, the following statement shall appear inimmediate proximity to each listing of the prize in each place the prizeappears in the written prize notice and shall be in not less than 10-pointboldface type: "YOU MUST PAY $_____ IN ORDER TO RECEIVE OR USE THIS ITEM."
(4) The information required in a written prize notice under paragraph(1)(D) shall be on the first page of the written prize notice in not less than10-point boldface type. The information required under paragraph (1)(F) and (G)shall be in not less than 10-point boldface type.
(5) If a written prize notice is given by a solicitor on behalf of asponsor, the name of the sponsor shall be more prominently and conspicuouslydisplayed than the name of the promoter.
(6) A solicitor or sponsor shall not do any of the following:
(A) Place on an envelope containing a written prize notice anyrepresentation that the person to whom the envelope is addressed has beenselected or may be eligible to receive a prize.
(B) Deliver a written prize notice that contains language, or is designed ina manner, that would lead a reasonable person to believe that it originatesfrom a government agency, public utility, insurance company, consumer reportingagency, debt collector or law firm unless the written prize notice originatesfrom that source.
(C) Represent directly or by implication that the number of individualseligible for the prize is limited or that an individual has been selected toreceive a particular prize unless the representation is true.
(d) If a prize notice requires or invites an individual to view, hear orattend a sales presentation in order to claim a prize, the sales presentationshall not begin until the solicitor does all of the following:
(1) Informs the individual of the prize, if any, that has been awarded tothe individual.
(2) If the individual has been awarded a prize, delivers to the individualthe prize or the item selected by the individual under subsection (e) if theprize is not available.
(e) (1) A solicitor who represents to an individual in a written prizenotice that the individual has been awarded a prize shall provide the prize tothe individual unless the prize is not available. If the prize is notavailable, the solicitor shall provide the individual with any one of thefollowing items selected by the individual:
(A) Any other prize listed in the written prize notice that is available andthat is of equal or greater value.
(B) The verifiable retail value of the prize in the form of cash, a moneyorder or a certified check.
(C) A voucher, certificate or other evidence of obligation stating that theprize will be shipped to the individual within 30 days at no cost to theindividual.
(2) If a voucher, certificate of other evidence of obligation deliveredunder paragraph (1)(C) is not honored within 30 days, the solicitor shalldeliver to the individual the verifiable retail value of the prize in the formof cash, a money order or a certified check. The sponsor shall make the paymentto the individual if the solicitor fails to do so.
(f) Nothing in this section shall be construed to permit an activityotherwise prohibited by law.
(g) Any violation of this section is an unconscionable act or practice underthe Kansas consumer protection act.
(h) In addition to any other remedies, a person suffering pecuniary lossbecause of a violation by another person of this section may bring an action inany court of competent jurisdiction and shall recover all of the following:
(1) The greater of $500 or twice the amount of the pecuniary loss.
(2) Costs and reasonable attorney fees.
(i) The provisions of this section shall not apply to the sale or purchase,or solicitation or representation in connection therewith, of goods from acatalog or of books, recordings, videocassettes, periodicals and similar goodsthrough a membership group or club which is regulated by the federal tradecommission trade regulation rule concerning use of negative option plans bysellers in commerce or through a contractual plan or arrangement such as acontinuity plan, subscription arrangement or a single sale or purchase seriesarrangement under which the seller ships goods to a consumer who has consentedin advance to receive such goods and the recipient of such goods is given theopportunity, after examination of the goods, to receive a full refund ofcharges for the goods or unused portion thereof, upon return of the goods orunused portion thereof, undamaged.
(j) This section shall be part of and supplemental to the Kansas consumerprotection act.
History: L. 1994, ch. 277, § 1; July 1.