

Ask HN: Running a contest/competition - megamark16

So I'm working on my little side project,  a webapp builder called AppRabbit (http://apprabbit.com) that is similar to Zoho Creator or DabbleDB.  It's still missing some key features but I'd love to get people using it and giving me ideas for the direction I should take it.  So I decided it might be fun to have a contest to see who can build the coolest or most useful app with it, and I'd give away something small like a gift card or a something as a reward to the winner.<p>So my question is, has anyone done something like this before?  Do I need to worry about laws and regulations with regards to doing a little contest like this, or should I just wing it and try to keep it simple?  I figured I'd just judge this round myself, and maybe down the road if I do something like this again have some sort of judging committee or something.<p>So what do you folks think?
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brk
(disclosure: it's been ~10 years since I last had direct first-hand knowledge
of this).

Giving away something for free in a "no purchase required to win" sort of
promo is generally not a problem. The giveaway should generally be cheap (less
than $600, or maybe it's $2000 now)... anyway, less than the amount that would
be required to file a tax form in conjunction with the giveaway. Prize
winnings are supposed to be considered taxable income, but at a low threshold
point it is not an issue. In your case, I believe you're not going to be able
to afford a big enough prize for this to matter :)

The contests where you have more issues are the lottery-ticket type systems
where people pay to have a shot at winning a prize. The two big issues there
(again, see disclosure above) are that you generally have to have some sort of
non-profit status, and you have to have ownership/control of the physical
prize before collecting money (you can't use a portion of the ticket sales to
purchase the prize and then keep the difference).

For what you're describing, I think it's a good idea and easy to implement
with no complex overhead or liability.

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dctoedt
Contests that don't have a sweepstakes component are generally simpler from a
legal perspective -- many states regulate contests in which prizes are awarded
at random.

Contest losers sometimes sue on grounds that the contest sponsor supposedly
changed rules after the fact. (Such suits are often brought for breach of a
"unilateral contract" (see generally
[http://en.wikipedia.org/wiki/Contract#Bilateral_v._unilatera...](http://en.wikipedia.org/wiki/Contract#Bilateral_v._unilateral_contracts)).
With that in mind, it's usually better for contest rules to be as detailed as
practicable, especially as to how winners will be selected.

(This isn't legal advice, we don't have an attorney-client relationship, etc.,
etc.)

