News In Brief: October 10-October 14, 2022

October 14, 2022
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Flutter wins billion-dollar case over FanDuel acquisition, Dutch regulator throws out "illegal" operators and Malta suspends an operating licence.

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New York Supreme Court Sides With FanDuel In Compensation Case

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The New York State Supreme Court on Thursday (October 13) ruled that FanDuel and its board of directors properly compensated the company’s founders and 134 other former officers and employees for its merger with Paddy Power Betfair.

FanDuel merged with the U.S. operations of the Dublin-based gambling company in 2018 to create FanDuel Group. The lawsuit led by former CEO Nigel Eccles claimed that the company’s board and private-equity firm Shamrock Capital Advisors undervalued the sports-betting company to shut them out of an acquisition deal.

The founders, which also included Lesley Eccles, Tom Griffiths, Rob Jones and 134 other former officers and employees, had been seeing $1bn in damages.

In their ruling, the Supreme Court denied the claim of breach of fiduciary duty by directors and officers of FanDuel, who are governed by Scottish Law.

“FanDuel is a Scottish company, incorporated in Scotland, and under the so-called internal affairs doctrine, relationships between a company and its directors and shareholders are generally governed by the substantive law of the jurisdiction of incorporation,” according to the order released Thursday by court clerk Susanna Molina Rojas.

The justices also found the plaintiffs failed to “state a claim for breach of fiduciary duty under Scots law”.

“This is a sweeping victory for our client which confirms that the transaction was fundamentally fair, and the proceeds were appropriately distributed,” said Mark Kirsch, a partner at King & Spaulding who represented FanDuel and its board of directors.

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'Illegal' Operators Leave Netherlands After Enforcement Action

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The Netherlands Gambling Authority (KSA) has announced that two online gambling providers found to be offering services aimed at Dutch consumers without a local licence have left the market, following an investigation and potential fines.

LCS, which has a Swedish and Malta licence, and Malta-based MKC were investigated by the KSA, which found it possible to set up an account on the sites from the Netherlands.

LCS was facing a €165,000 penalty and MKC an €84,000 penalty if they did not agree to leave the market.

The KSA will now be monitoring both operators' sites to ensure they do not target Dutch consumers again, it said.

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MGA Suspends Arabmillionaire Licence

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The Malta Gaming Authority (MGA) has suspended Arabmillionaire Limited’s licence for a raft of compliance violations.

The operator cannot continue to do business, register new players or accept new customer deposits, but is required to retain and provide access to allow players to access their accounts and to refund all funds.

Arabmillionaire breached several licence conditions, including not paying fees on time or in full as well as failing to implement anti-money laundering procedures.

The suspension came into effect on October 12.

An appeal to the decision can be launched.

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Ukraine Explains Situation In Occupied Lands

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The Ukrainian Commission for Regulation of Gambling and Lotteries (KRAIL) has clarified how it determines what parts of the country are deemed as being occupied by Russia, meaning operators cannot offer gambling services there anymore.

KRAIL applies the definition in the Law of Ukraine "On Ensuring the Rights and Freedoms of citizens and the Legal Regime in the Temporarily Occupied Territory of Ukraine".

A separate list of communities located in the area of military operations or that are under temporary occupation, or encirclement has been created by the Ministry on Reintegration of Temporarily Occupied Territories of Ukraine.

Operators and state lottery organisers in occupied lands can still operate throughout the rest of Ukraine.

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Steve Wynn Foreign Lobbying Lawsuit Dismissed By Federal Judge

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A federal judge has dismissed an effort by the U.S. Department of Justice to have former casino owner Steve Wynn register as a foreign agent for China under the Foreign Agents Registration Act (FARA).

The DOJ sued Wynn in May, claiming he lobbied former President Donald Trump and members of his administration on behalf of the Chinese government in 2017 to help secure the return of a Chinese national Guo Wengui, who had traveled to the United States and sought asylum.

Wynn was chairman and CEO of Wynn Resorts at the time.

U.S. District Court Judge James Boasberg ruled that the federal government does not have the power to require such a disclosure after the purported relationship has ended. The DOJ had argued that the FARA required Wynn acknowledge his work on behalf of a foreign government even though it had already ended.

“While the goals of FARA are laudable, this court is bound to apply the statute as interpreted by the D.C. Circuit. And that required dismissal,” Boasberg wrote.

The DOJ, which can appeal to the D.C. Circuit Court, expressed its disappointment with the ruling.

“The district court acknowledged in its opinion that the result it reached frustrates FARA’s purpose of getting information to the public that it needs to evaluate the extent of foreign influence over U.S. policy and public opinion,” the DOJ said in a statement emailed to VIXIO GamblingCompliance.

“While the court considered itself bound to apply an earlier precedent of the DC Circuit notwithstanding these concerns, the government respectfully disagrees with today’s ruling and is considering options in the litigation and more generally. The department remains committed to enforcing the Foreign Agents Registration Act.”

Lawyers for Wynn praised the decision.

“We are pleased but not surprised by [Wednesday’s] ruling,” Reid Weingarten and Brian Heberlig, partners in the Washington, D.C. office of Steptoe & Johnson, said in a statement.

“Steve Wynn never acted as a Chinese agent and is happy to put this misguided lawsuit behind him.”

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Genius, Sportradar End UK Data Dispute

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Data providers Sportradar and Genius Sports have settled their long-running legal dispute over access to UK football match data.

Suits and counter-suits had been issued over the past few years between the two parties and Football Data Co (FDC), which sells official in-play league data for the Premier League, Football League and Scottish Professional Football League to Genius Sports subsidiary Betgenius.

Sportradar had been collecting unofficial live data by sending staff to matches and accused officials of unlawfully ejecting their scouts.

In a joint statement issued on Tuesday (October 11), the companies said the litigation had been resolved.

The only element of the settlement that has been disclosed is a deal between Sportradar and FDC to purchase a “delayed feed” of official data, while Betgenius retains exclusive rights to “low latency” information through to 2024.

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MGA Extends Player Protection Consultation

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The Malta Gaming Authority (MGA) has extended its ongoing consultation on new responsible gambling rules.

The “closed consultation” is only open to licensees and will now close on October 24.

“This extension will allow all stakeholders additional time to thoroughly review the amendments and provide feedback,” according to the MGA.

Included in the proposals is an introduction of five markers of harm that must be considered by licensees when defining effective measures and processes to detect and address problem gambling.

Additionally, it covers responsible gambling training for employees.

A key aim of the proposals is to strengthen existing player protection measures and for the regulator to conduct research ahead of the planned publication of detailed player protection guidelines, said the MGA.

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Bangladesh Bans Gaming Websites, Blocks Apps

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Bangladesh’s telecommunications regulator has banned 331 online gambling websites and referred illegal gaming apps and other material to social media giants to block.

The Bangladesh Telecommunication Regulatory Commission (BTRC) said on its Facebook page on Monday (October 10) that thousands of customers have “become destitute” because of online gambling, and that “online gaming continues to grow and young people are addicted to it” despite a “continuous crackdown”.

The BTRC said it reported 150 Google apps with gambling content, of which 14 have been closed down so far. It added that it reported 27 links to Facebook and 69 links to YouTube.

The Muslim-majority nation of Bangladesh is one of the strictest jurisdictions in Asia in regard to gambling, with the most recent attempts to regulate border casinos and other gaming stymied in 2020 by the High Court, which ordered a prohibition on all forms of gambling.

However, poor enforcement, nominal penalties and growing technological savvy have spurred gaming volume in the South Asian nation.

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Brazilian Senator Proposes Warning On Gambling Establishments

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Brazil’s Senate is considering a bill which would require any person or premises conducting any kind of gambling to post a notice about its risks.

The bill was proposed by Senator Eduardo Girão, a long time and outspoken opponent of gambling. The bill, if approved, would likely apply to both gambling that is currently regulated in Brazil, such as lotteries, and gambling that is about to be regulated, such as sports betting (which is specifically named in the bill).

The proposed text indicates that entities would be required to display the warning: "Gambling can be addictive and cause emotional or financial problems", in a “clear and visible” way. Lottery houses, jockey clubs, fixed-odds sports betting, poker and video poker houses are all named as entities that would be required to do so.

The penalty for non-compliance would be a fine of BRL300,000, or nearly $58,000.

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Uruguay Lottery Head Says Ads During International Tournaments Unfair

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Ricardo Berois, the director of lotteries, testified before Uruguay’s Treasury Commission in the Chamber of Deputies that his department has blocked 1,525 online gambling sites since it was given the authority to do so in 2017.

He also gave an update on the case against the South American Football Confederation (CONMEBOL), which his agency fined after advertisements from Betfair during the Copa Libertadores on August 2 during a match in Montevideo.

Berois stated that although these sponsorships are fine to advertise in places like the famed Bombonera (in Buenos Aires, Argentina), it is against Uruguayan regulation. He highlighted that it is unfair to Uruguayan teams who cannot do the same.

“I hope to have some luck, because the fight is not easy, but we are going to collect something from them: they should be careful,” he said of CONMEBOL. “Furthermore, it is unfair because if the Uruguayan teams, who make a great sacrifice, want to have an advertisement here from an international gambling entity, it is forbidden: I am talking about Uruguayan teams that are having a hard time economically; however, CONMEBOL comes and does it.”

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Tanasijevich Resigns From Marina Bay Sands

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George Tanasijevich, the top Las Vegas Sands executive who helped secure a licence for Marina Bay Sands (MBS) in Singapore and turned it into a revenue colossus, has resigned and left the gaming industry.

Tanasijevich has stepped down from his posts of MBS managing director and head of global development for Las Vegas Sands to work on real estate in Saudi Arabia, the Straits Times and Inside Asian Gaming reported, citing company spokespeople.

Tanasijevich’s departure marks the end of an era for MBS and Singapore’s gaming industry.

The move is as noteworthy as the resignation of colleague Andrew MacDonald, the Sands executive and casino operations heavyweight who left Sands mid-2021 before joining rival Resorts World Sentosa last month.

Formerly MBS president and CEO, Tanasijevich had been charged with Las Vegas Sands’ ill-fated push into the integrated resort segment in Japan and other potential markets.

The company eventually closed down its campaigns in Osaka and Yokohama, with Tanasijevich being one of the first executives to publicly warn that the outlook for industry investors was deteriorating.

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German Regulator Ramps Up Lottoland Pressure

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German gambling regulator GGL has continued its campaign against lottery betting firm Lottoland by instructing more internet companies to cut off access to the operator.

The GGL issued a statement in July that it begun enforcement action against Lottoland, on the grounds that it offers unlicensed betting and customers may be confused about whether or not they are entering an actual lottery.

On Friday (October 7), the regulator said it had ordered three more internet service providers (ISPs) to block Lottoland websites.

ISPs are not compelled to comply with the order and some have expressed concern at the nature of the “voluntary requests”.

The regulator said it has also undertaken payment blocking measures against Lottoland.

Responding to the first round of enforcement action in July, Lottoland said it would challenge the regulator in court.

"It is obvious that the state-owned GGL wants to create facts on behalf of the state lottery companies and federal states in order to protect the ultimately remaining lottery monopoly and to eliminate competitors in the lottery sector — for purely fiscal reasons," said Laura Pearson, the operator’s VP of corporate affairs.

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Nevada Targets Counterfeiter For Casino 'Black Book'

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A man arrested just short of three dozen times by Nevada gaming agents for the theft of casino chips or the production of counterfeit chips has been nominated for inclusion on the state's List of Excluded Persons from all licensed casinos, also known as the Black Book.

The Nevada Gaming Commission is expected to add Leonard Morgan Hairston’s name to the so-called Black Book on October 20 after the Nevada Gaming Control Board (NGCB) voted unanimously on Wednesday (October 5) to send the nomination to the commission.

Should the NGC approve Hairston’s nomination, he would become the 37th person currently on the list.

The addition of Hairston would be a return to adding a person to the list for cheating casino games or being associated with organized crime.

On August 25, the five-member commission placed Kenrick Laronte Weatherspoon, who had a history of assaults on women and forcing women into prostitution at Las Vegas casinos, in the Black Book.

“I think this is a very traditional proposal for the list of excluded persons,” said NGCB member Brittnie Watkins. “I think we struggled with, or we had more conversations about our last nominee because we struggled to find they exact nexus between gaming because it was mostly focused on human trafficking inside Nevada casinos.

“This case obviously has that direct nexus because he has been stealing from Nevada casinos and has made [them] a target of his criminal activity on multiple occasions.”

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EL Rewards Norsk Tipping For Interaction Innovation

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Trade group European Lotteries has handed an award for innovation to Norsk Tipping in recognition of its player interaction programme.

"On the occasion of the 2022 EL Innovation seminar, we are delighted to award the top prize to Norsk Tipping. Putting responsibility at its core, this lottery’s campaign ticked all the boxes to be the worthy winner," said Jarmo Kumpulainen, executive chair of the EL Innovation & Technology Working Group.

"Customer friendly systems, effective campaigns, attractive products, high levels of trust and a good reputation are among the secrets of Norsk Tipping’s success," he said.

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Flutter wins billion-dollar case over FanDuel acquisition, Dutch regulator throws out "illegal" operators and Malta suspends an operating licence.

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