Attorney Publication

Feb 21, 2007

Play strictly by rules in charity co-ventures

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What could be bad about selling a product and then donating some money to charity? Hopefully, nothing. However, if a marketer is going to tout the donation as part of its marketing of a product or service, it is important that a number of rules be followed so that the public is not misled about the donation and the charity actually gets the donation promised. While good companies would do this as a matter of course, the actions of a few bad actors have led many states to take a closer look at commercial ventures between a marketer and a charity that are intended to benefit the charity. As a result, more and more state laws have been passed that impose specific legal requirements on how to run what is legally called a commercial co-venture (but for the purposes of this article I will call the relationship a partnership, and each party a partner) with charity.