I have a question: I want to do a few contests on my website where I will be giving away a cash prize to the user who correctly answers a certain set of questions first, and so my question is, can I legally do something like that if I'm based in California and not get in to any kind of legal trouble!? I know that running lotteries is not permitted in California but I'm not sure whether what I'm planning to do can be considered a lottery under the California law!? I found this excerpt from the CA law in regards to my question, but I'm still confused... "Penal Code Sec.319. A lottery is any scheme for the disposal or distribution of property by chance, among persons who have paid or promised to pay any valuable consideration for the chance of obtaining such property or a portion of it, or for any share or any interest in such property, upon any agreement, understanding, or expectation that it is to be distributed or disposed of by lot or chance, whether called a lottery, raffle, or gift enterprise, or by whatever name the same may be known." It is my understanding that what I'm planning to do cannot be constituted as a lottery per CA lottery law, because 1. All of all my users will not have to pay anything and 2. It's not a "game" of chance as the prize will be given to the first person who answers certain questions correctly which makes it more like a game of skill (or in my case knowledge) which is permitted by law... Anyway, let me know what you think guys!! Thanks!!
Sounds like you are not planning a lottery but rather a legal contest. Make sure you read the rules and make sure to comply with each rule.
You are in California, but your site is accessible worldwide. You may need to disqualify residents of certain states from entering since every state has different laws regarding it's residents and contests.