The headlines say Betfair 'lost' its court case against Racing NSW -- but the truth lies in the fine detail of the judge's summing-up. In it, he paves the way for Betfair to appeal his ruling. Reaction to the court outcome is slowly being realised - and Racing NSW doesn't come out looking pretty. Bill Saunders, of Cyberhorse, who has closely followed the whole case, says: 'Yesterday's judgments by Justice Perram in the Sportsbet and Betfair cases expose both the breathtaking arrogance and the st
The headlines say Betfair 'lost' its court case against Racing NSW -- but the truth lies in the fine detail of the judge's summing-up. In it, he paves the way for Betfair to appeal his ruling. Reaction to the court outcome is slowly being realised - and Racing NSW doesn't come out looking pretty. Bill Saunders, of Cyberhorse, who has closely followed the whole case, says: 'Yesterday's judgments by Justice Perram in the Sportsbet and Betfair cases expose both the breathtaking arrogance and the stupidity of the Racing NSW Board at the time in thinking that it could breach the free trade provisions of Section 92 of the Australian Constitution and get away with it. The judgment details a plan apparently concocted by Robert Nason head of wagering at TabCorp in 2007 and carried to the Racing NSW Board by its CEO Peter V'Landys. The plan involved a race fields fee of 1.5-2% of turnover being imposed on all operators wagering on racing in New South Wales, but structured in such a way as to refund all the fees paid by TabCorp's New South Wales and Victorian totalisator divisions on New South Wales racing.'
Justice Perram went so far as to brand Racing NSW's behavior as 'reckless folly'. He ruled: 'Given the clear understanding that was held by the board of RNSW and Mr V'landys, that fee could only be applied neutrally and that this had to be so as a matter of substance, and not merely form. I must say that I am entirely puzzled as to how it was thought to be permissible, still less prudent as a statutory authority with the public responsibilities attendant thereon, to assume that the TAB or the New South Wales on-course bookmakers could be relieved from the economic burden of the fee. In any event, it is not presently necessary to determine why this reckless folly was chanced; it suffices only to conclude that it was.'
Bill Saunders goes on to say that 'the facts disclosed by the Racing NSW Board papers explain the incredible lengths which Racing NSW went to during both cases to conceal from Sportsbet and Betfair the fact that TabCorp was being refunded all of its race field fees and that New South Wales bookmakers were paying virtually nothing because of the $5 million turnover exemption.'
Why did the Betfair challenge fail? Well, Betfair was disadvantaged by its lack of knowledge of the rebate arrangement when preparing its statement of claim. Sportsbet, with its case being heard after Betfair, was able to amend its statement of claim accordingly. While Betfair has in the interim lost its claim based on the lack of evidence that it was discriminated against, it is quite likely to win anyway. Saunders says: 'In fact it could be argued that it was only by having the Betfair case first that the facts about the TabCorp rebate arrangement became apparent to Sportsbet. What the Sportsbet judgment means is that all interstate wagering operators were discriminated against and therefore they all have a claim against Racing NSW to have their race field levy payments refunded with interest.'
There are serious legal implications, too, for TABCorp because of its role in the fee transactions sleight--of-hand. Bill Saunders says: 'Interestingly, Perram held up publication of his Sportsbet judgment for an hour yesterday in order to give TabCorp time to read it. He is clearly aware of its implications for the wagering giant.'