Resort Company Penalized for Running Misleading Contests

Competition Bureau Investigation Results in Penalty

Ottawa, November 23, 2009 — The Competition Bureau announced today that Manitoba-based Elkhorn Ranch & Resort Ltd. (Elkhorn), which sells time shares for vacation properties, has agreed to pay $170,000 for running misleading promotional contests.

After conducting an investigation into Elkhorn's 2006 and 2007 promotional contests, the Bureau concluded that the company had run contests without fair disclosure of accurate odds of winning and without ensuring that winners were selected on a random basis. Elkhorn's contests also gave the misleading impression that the grand prize was a brand new SUV, when the prize, if awarded, was a one or two–year lease on an SUV, with stringent conditions. The contests were primarily associated with the marketing of Elkhorn's time share properties in Western Canada. Consumers were solicited by phone, at trade shows and at time share presentations.

"When consumers enter a contest, they should have a reasonable chance of winning based on clear rules," said Andrea Rosen, Deputy Commissioner of Competition, Fair Business Practices Branch. "If businesses run bogus contests to attract customers, they compromise the trust of consumers and hurt competition by gaining an unfair advantage over competitors operating legitimate contests."

Elkhorn is in the business of selling time shares for properties in: Clear Lake, Manitoba; Canmore, Alberta; and Panorama, British Columbia. It includes the subsidiaries: Elkhorn Vacations for Life Limited Partnership – Manitoba; Elkhorn Ranch and Conference Centre; Elkhorn Resort Spa & Conference Centre; Elkhorn Resort and Spa; and Elkhorn Ranch & Spa – Alberta.

As part of the consent agreement, Elkhorn is required to:

• pay an administrative monetary penalty of $150,000;
• pay costs of the Bureau's investigation in the amount of $20,000;
• ensure that all future contests are conducted fairly and with full disclosure;
• publish corrective notices in select newspapers and on Elkhorn Web sites; and
• implement a corporate compliance program to ensure conformity with the deceptive marketing provisions of the Competition Act.

The consent agreement was filed with the Competition Tribunal today. A copy is available on the Tribunal Web site.

Consumers who suspect they have been a victim of deceptive marketing practices or who want information on the application of the Competition Act should contact the Bureau's Information Centre at 1-800-348-5358 or visit www.competitionbureau.gc.ca.

The Competition Bureau is an independent law enforcement agency that contributes to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

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