Do not understand Liability Release paragraph

Question

I participated in a data science competition. I won and in order to claim the prize I need to sign a DECLARATION of ELIGIBILITY, PUBLICITY AGREEMENT, & RELEASE OF LIABILITY. There are three main paragraphs. These are

1. COMPLIANCE WITH CONTEST RULES. I affirm and represent that I have complied with all the Official Rules of the Contest and that I have committed no fraud or deception in entering the Contest and/or in claiming any prize. I further represent and warrant to Sponsor that, as of the date I entered this Contest and the date of this Declaration, I was not and I am not an employee of Sponsor, those working on its behalf, and all other businesses involved in this Contest (including prize vendor/provider), as well as each of their respective employees, officers, directors, agents and representatives, successors and assigns (collectively, the “Contest Parties”), or their respective subsidiaries, affiliates, advertising and Contest agencies, retailers or distributors, or a member of their immediate family (e.g., spouses, domestic partners, parents, children, siblings, grandparents) or household (i.e., people who share the same residence at least 3 months a year (whether related or not), nor domiciled with such employee.
2. PUBLICITY RELEASE. I understand and agree that unless otherwise prohibited by law, the Contest Parties and their advertising and promotional agencies, and anyone duly authorized by any of them, will have the right to use my entry, name, address (city and state), photograph and/or likeness, my biographical information, and/or any taped appearance or interview with me in any and all media, whether now known or hereafter devised, anywhere in the world in perpetuity for purposes of advertising or trade in advertising, promoting, and publicizing Sponsor and its products and services (including without limitation, the Contest and similar contests), and I hereby grant to Sponsor and its promotional agents, and their agents and assigns, without limitation, all of the above rights without further compensation or permission. I agree that I shall have no right of approval, no claim to compensation, and no claim (including without limitation, claims based on invasion of privacy, defamation, or right of publicity) arising out of any use, blurring, distortion, alteration, illusory effect, or use in composite form of my name, address (city and state), picture, likeness, and biographical information.
3. LIABLITY RELEASE. I understand and acknowledge that I am solely responsible for any harm, injury or other matter than may result from of the Prize. In consideration for receiving the Prize, I understand, acknowledge, and agree, on my own behalf, and on behalf of my heirs, executors, administrators, legal representatives, successors and assigns (“Releasing Parties”), hereby release, and agree to defend, indemnify, and hold harmless the Contest Parties, those working on their respective behalves, and all other businesses involved in the Contest (including prize vendor/provider), as well as each of their respective employees, officers, directors, agents and representatives, successors and assigns (collectively,the “Released Parties”), from any and all actions, causes of action, suits, debts, dues, sums of money,accounts, reckonings, covenants, contracts, controversies, agreements, promises, trespasses, lost profits,indirect or direct damages, consequential damages, incidental damages, punitive or exemplary damages,including for injury and death, judgments, extent, executions, claims and demands whatsoever, in law,admiralty or equity, whether known or unknown, foreseen or unforeseen, against the Released Parties which any one or more of the Releasing Parties ever had, now have or hereafter can, shall or may have,whether known or unknown, asserted or non-asserted, which may in any way arise out of or relate to my participation in this sweepstakes or the awarding, acceptance and use or misuse of the Prize, and I hereby expressly, voluntarily and knowingly waive any rights the Releasing Parties may have under any State law similar to California Civil Code Section 1542, which provides: "A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his settlement with the debtor or released party.”

I added the paragraphs as is.

I am concerned regarding the liability release. I am non-native English-speaker and therefore I am not from the US. As far as I understand, the paragraph liability release states that I could be held accountable basically for everything. The liability release contains the "[...]hereby release, and agree to defend, indemnify, and hold harmless the Contest Parties[...]". What does this part mean? Does this mean I would need to defend and indemnify them for anything? What does hold harmless mean? Overall, what does this liability release state? Does the liability release have negative consequences for me?

Could anyone explain me in plain English, what the liability release contains and what the consequences would be if I sign this declaration?

Answer 1

The "COMPLIANCE WITH CONTEST RULES" section says basically that the contestant followed the contest rules, told the truth in all in formation provided in connection with the contest, and did not work for the contest sponsor and was not affiliated with the sponsor directly or indirectly (so as to avoid possible bias in awarding the prize).

The "PUBLICITY RELEASE" section says that those running the contest, and the sponsor, can use the winner's name photograph, image, and information in their advertising. They can do this forever, both in connection with the contest dn future contests, and in other ways. They have no need to get the winner's permission or approval, nor to pay the winner beyond the prize.

The "LIABLITY RELEASE" says basically that the winner will not sue or claim damages from the sponsor or anyone involved in running the contest for anything connected with teh contest or the winner's participation. And it says that if someone else sues because of anything the winner did, or because of the winner's participation in the contest, or anything related to that, the winner will pay any damages awarded and will help defend any such case.

All of these are reasonably standard provisions. In most cases if the winner has not done anything dishonest or weird, they will never come into effect. They are to avoid risks to the contest organizers in rare cases. For example, suppose the winner was under a contract to hand over any prizes to a creditor, and the creditor sued because the prize was paid directly to the winner. The organizers don't want to be liable on any such suit. Other possible but unusual cases could be imagined where the liability release might apply.

If the winner signs the liability release, s/he will be agreeing to pay any legal damages any suit might impose on the sponsor or contest organizers or related parties because someone (including the winner) sues because of something the winner did, or something related to the winner having participated and won. If no such claim is made, it will have no effect.

Answer 2

Could anyone explain me in plain English, what the liability release contains and what the consequences would be if I sign this declaration?

The clause is too convoluted. It is an outrageous example of draftsman's sloppiness and ineptitude. For instance, it is entirely unclear what you "understand, acknowledge, and agree on [your] own behalf, and on behalf of [the Releasing Parties]" because then the same sentence goes on with "hereby release, and agree to defend, indemnify".

Regardless of whether or not these terms are enforceable, the clause on Liability Release certainly makes you responsible for anything and everything "tha[t] may result from of [sic] the Prize" and from anything "which may in any way arise out of or relate to my participation [...] or the awarding, acceptance and use [...] of the Prize" (emphasis added). This clause literally can lead to several kinds of aberrant scenarios. For instance, if the Contest Parties stole the funds of which your prize consists, the clause requires you to cover their attorney fees (which most likely will outweigh the value of the prize).

Another red flag is the clause on Publicity Release. By means of that clause you are literally authorizing others to defame you and make unwarranted & ridiculous alterations of your "picture, likeness, and biographical information. Under US defamation law, the defamed person's agreement to defamatory publications strikes his claim(s) of defamation. At that point it is irrelevant whether that person knew beforehand the content of such publications.