Guam § 32403 - Unlawful Advertising; Conditional Offer of Prizes or

§ 32403. Unlawful Advertising; Conditional Offer of Prizes or

Gifts.

(a) It is unlawful for any person to use the term "prize" or

"gift" or other similar term in any manner that would be untrue or

misleading, including, but not limited to, in the manner made

unlawful in subsections (b) or (c) of this section.

(b) If a person is notified that such person has already won a

prize in any contest, it is unlawful to require the purchase of goods

or services or payment of any money whatsoever as a prerequisite

to collect the prize, and the contest prize shall be delivered to the

awardee without a requirement to pay money or purchase goods

or services.

(c) It is unlawful to notify any person by any means that such

person will receive a gift (including a prize or consisting of a

prize) and that as a condition of receiving the gift such person

must pay any money, or purchase or lease (including rent) any

goods or services, if any one (1) or more of the following

conditions exist:

(1) The shipping charge, depending on the method of

shipping used, exceeds

(A) The average cost of postage or the average

charge of a delivery service in the business of delivering

goods of like size, weight, and kind for shippers other

than the offerer of the gift for the geographic area in

which the gift is being distributed, or

(B) The exact amount for shipping paid to an

independent fulfillment house or an independent

supplier, either of which is in the business of shipping

goods for shippers other than the offerer of the gift.

(2) The handling charge

(A) Is not reasonable, or

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(B) Exceeds the actual cost of handling, or

(C) Exceeds the sum of Three Dollars ($3) in any

transaction, or

(D) In the case of a general merchandise retailer,

exceeds the actual amount for handling paid to an

independent fulfillment house or supplier, either of

which is in the business of handling goods for

businesses other than the offerer of the gift.

(3) Any goods or services which must be purchased or

leased by the offeree of the gift in order to obtain the gift

could have been purchased through the same marketing

channel in which the gift was offered for a lower price

without the gift items at or proximate to the time the gift was

offered.

(4) The majority of the gift offerer’s sales or leases

within the preceding year, through the marketing channel in

which the gift is offered or through in-person sales at retail

outlets, of the type of goods or services which must be

purchased or leased, in order to obtain the gift item, were

made in conjunction with the offer of a gift. This subsection

does not apply to a gift offer made by a general merchandise

retailer in conjunction with a sale at an on-island location, or

to the sale or lease through mail order of goods or services

(excluding catalog sales) if

(A) the goods or services are of a type unlike any

other type of goods or services sold or leased by the

general merchandise retailer at any time during the

period beginning six (6) months before and continuing

until six (6) months after the gift offer,

(B) the gift offer does not extend for a period of

more than two (2) months, and

(C) the gift offer is not untrue or misleading in any

manner.

(5) The gift offerer represents that the offeree has been

specially selected in any manner unless (A) the

representation is true and (B) the offeree made purchase from

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the gift offerer within the six-(6-)month period before the gift

offer was made or has a credit card issued by, or a retail

installment account with, the gift offerer or the offeree

previously entered the contest offered by the offeree.

(6) Nothing in this section nor in this chapter may be

used as a defense by an offerer to prevent an offerer from

awarding a gift or prize to a contest winner, even if the

contest was in violation of this or any other statute; and

nothing herein shall prevent legitimate contests which do not

require the offeree to spend any money with the offerer or

purchase any goods or services from the offerer. If an offerer

offers a contest winner a prize, this section only invalidates

any requirement that the winner purchase goods or services

or pay money to get the prize, and does not relieve the offerer

of the obligation to award the offeree the prize as won or

promised. If a contest sponsor fails to award a prize as

promised, the Superior Court may, upon application of the

Attorney General or the prize winner, order the sponsor to

make the award as promised or pay the full retail value of the

prize, plus attorney’s fees, and such civil penalties as are

provided in this chapter or in any other statute.

(7) This article does not prohibit legitimate contests not

requiring the purchase of goods or services or the expenditure

of money; nor offers of gifts tied to the sale of other goods or

services, if no element of chance is involved, and if the

requirement that other goods must be purchased is clearly

stated in all advertising and communications; nor does it

apply to games at Fiesta Guam, or its successor, or to games

conducted in village fiestas authorized by the village mayor.

(8) Nothing in this section authorizes operation of a

lottery which requires a purchase or expenditure of money,

nor a game of chance which requires a purchase or

expenditure of money.

(9) In addition to the remedies provided for in Articles

1 and 2 of this chapter, the Attorney General may also

represent a consumer in an action for specific performance of

the terms of the contest or offer of gift.

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(d) The following definitions apply to this section:

(1) Marketing channel means a method of retail

distribution, including, but not limited to, catalog sales, mail

order sales, telephone sales, and in-person sales at retail

outlets.

(2) General merchandise retailer means any person or

entity regardless of the form of organization that has

continuously offered for sale or lease more than one hundred

(100) different types of goods or services to the public in

Guam throughout a period exceeding five (5) years.

(3) Each violation of the provisions of this section is a

misdemeanor.

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