User-generated content can be risky

Is user-generated content (UGC) the solution that marketers have been waiting for? YouTube, the "digital revolution," and Web 2.0 have certainly opened the floodgates for consumers to create what they want. Seizing on the popularity, clients are constantly asking PR firms and other marcomms agencies to incorporate creative consumer content into marketing and publicity campaigns.

Is user-generated content (UGC) the solution that marketers have been waiting for? YouTube, the "digital revolution," and Web 2.0 have certainly opened the floodgates for consumers to create what they want. Seizing on the popularity, clients are constantly asking PR firms and other marcomms agencies to incorporate creative consumer content into marketing and publicity campaigns.

As is often the case with new publicity techniques, we are now seeing a rush to move forward without considering the risks. We face these risks head-on every day, addressing the potential for legal claims associated with hosting the content. There are three major areas of concern: First, infringing the intellectual property rights of others; second, complying with the sweepstakes and contest laws; and third, encouraging dangerous behavior.

When you ask consumers to create content, you never know what you are going to get. Consumers might be lifting book passages, copying scenes from movies, using celebrities' images, or incorporating popular music - all of which could be a violation of intellectual property rights that could hold you and your client liable.

Marketers have two options to minimize risk: You can either provide all of the content that
participants can use to generate their submission, or you can provide very specific guidelines that prohibit participants from submitting content that violates third party's rights, and then screen the submissions to make sure nothing gets missed.

Marketing programs featuring UGC are usually associated with some sort of prize. Lottery and gambling laws could apply to your program. With a prize included and winners being chosen randomly or based on skill, be sure that the promotion is structured to comply with the law, including a comprehensive set of official rules.

And once you draft the rules, follow them. We experienced an issue recently where a sponsor arguably failed to follow their own rules in a UGC contest. The sponsor's actions were noticed by a keen-eyed participant, who blogged about it, leading to consumer complaints and regulatory inquiries. While the issue was ultimately favorably resolved, it could have been far worse had a regulator or consumer took it further.

Finally, be wary of what you ask consumers to do when creating the content for you. A client recently came to us with a concept for a UGC contest that asked consumers to submit a video with their best freestyle skateboard trick. We thought that would be a bad idea and convinced the client of the same. It has long been held that marketers can be found liable for injuries and damages that occur while sponsoring promotions that encourage dangerous behavior.

User generated content, Web 2.0, and the digital age have surely unleashed new and unique opportunities for PR firms. However, firms still need to be mindful of long established rules and risks. Don't let your UGC promotion become an example of what not to do. It's a sure way to both cause regulatory scrutiny and impair your client relationship.

Michael Lasky and Joseph Lewczak are partners at the New York law firm of Davis & Gilbert.

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