Well according to a June 5, 2007, decision by a Federal District Court in California, when it falls within “the plain language of the statute…”—that is, California’s Gift Certificate statute—(Section 1749.5 of the California Civil Code). Scared yet? You might be.
Philip Morris used proof-of-purchase promotions enabling consumers to collect “Marlboro Miles” from packages of cigarettes and send them in for catalog items. A few years ago, Philip Morris changed the promotion and announced that the “Old Miles” (ones collected prior to 2003) were only valid through 2003 and that in 2004, it would only accept the “New Miles.” In 2006, Philip Morris decided to end the promotion altogether and removed “Marlboro Miles” proofs-of-purchase material on cigarette packages sometime in 2006, indicating that folks had until the end of September to put in their catalog order requests with any “New Miles” they had accumulated.
As if the tobacco industry didn’t have enough trouble, now comes the class action! Since these were distributed to consumers under “an awards, loyalty or promotion program” the plaintiffs argue they should be considered gift certificates and covered under the California Gift Certificate statute. If that is correct, Old Miles, New Miles or any miles simply can’t expire!
But wait a minute. These aren’t really “gift certificates,” are they? Look at dictionary definitions, case law, the text of the California statute itself. Listen, if proof-of-purchase coupons on boxes are gift certificates when you run a promotion, then anything and everything that is part of any sort of rewards, loyalty or promotional campaign—think bottle caps, box tops, candy wrappers—rises to the status of potential gift certificate. What’s worse, if the decision holds (Courtney Reynolds v. Philip Morris USA), once the coupons or other items are categorized as a gift certificate, in California (among other states), they can’t expire—ever! In fact, read the decision and you’ll walk away with the notion that unless a 10-point ALL CAPITAL type font is used for an expiration date on the face of the proof-of-purchase icon or label, you may never be able to terminate at all.
Think the law and regulation of promotions—gift certificates, loyalty rewards programs, sweepstakes, contests and coupons, interactive gaming, online gambling—is complicated? That’s why Rimon created the Advertising Technology & Media law group. Between our leading practice in the U.S., our network of offices around the world, and the worldwide GALA network, we are at the top of our game. Put us to work for you…and while you are at it, pay attention to the special rules applicable to marketing and advertising which is (or could arguably be) targeted at children.
If you think the tobacco industry is the only target, just pick up a newspaper. Obesity in children is caused by advertising—didn’t everyone know that? The regulators seem increasingly inclined to think so. Violent behavior? Clearly there’s too much violence in movies and television programming. At least that is what’s on the minds of some legislators. That’s why we have Adlaw By Request. The Internet has not simply expanded the reach of advertising and marketing, but has transformed (an unabashed plug for Transformers) advertising and marketing into new worlds—both real and virtual. It’s a complex and highly regulated world out there—let us help guide you through it.