Copy Centers Can Fight to Keep Sweepstakes

SAN JOSE, Calif. (CN) - Alameda County must face claims that it violates the rights of businesses by banning all "sweepstakes centers," a federal judge ruled, but a restraining order is premature.

Though the county sought to dismiss the suit for failing to state a claim, U.S. District Judge Susan Illston found that Net Connection and Web Access had raised several issues that merited a trial.

Specifically, they accuse Alameda of violating businesses' constitutional rights to equal protection, procedural and substantive due process, and free speech.

Net Connection and Web Access, which offer computer rentals as well as copy and fax services, brought the suit after the county issued an abatement order prohibiting them from engaging in "any and all sweepstakes use."

The businesses operate no-purchase necessary sweepstakes to promote their products and services. Customers can use computer terminals to learn the results of their sweepstakes entry or play a different sweepstakes game.

They claim, however, that the county ordinance fails to properly define "sweepstakes centers."

Though their sweepstakes are "legally undistinguishable" from sweepstakes utilized by "McDonald's, Carl's Jr., Pepsi, and Coca-Cola," Alameda has not targeted those businesses, the businesses said.

Although Illston refused to dismiss the case, she declined to issue a restraining order to prevent enforcement of the ordinance because she found that the businesses had not "established that they are likely to succeed on the merits" of the suit.

Illston went on to suggest that the suit would likely be unsuccessful and pointed to numerous weaknesses in their claim.

In particular, evidence showed that the businesses' sweepstakes promotion seemed to be a "core" portion of their businesses although their licenses gives them only the right to operate a retail establishment. Furthermore, unlike other sweepstakes promotions, the businesses' promotions are not limited to a particular time period.

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