The Supreme Court of New South Wales (NSW) has provided an update on the ongoing legal case Tabcorp has initiated against Entain.
Presiding Judge James Stevenson has ruled that Tabcorp be granted access to documents relating to Entain’s partnership with the Australian Hotels Association New South Wales (AHA NSW).
Tabcorp has now stated that it welcomes the Court’s decision and will consider pursuing legal proceedings against Entain, contending that Entain’s deal with the AHA NSW violates its own monopoly on pub and hotel wagering in NSW.
The firm’s statement read: “The Court also determined that Entain and AHA NSW must give discovery of their legal advice regarding the legality of the agreement between them and arrangements with NSW venues. This is to determine whether they have been misleading in their dealings with venues.
“Tabcorp is concerned the arrangement between Entain and AHA NSW, depending on all the facts, raises a risk that Entain and/or AHA NSW may engage in illegal activity under the Unlawful Gambling Act 1998 (NSW).
“The Court accepted that whether the proposed arrangements will result in a breach of the Unlawful Gambling Act may well depend on the detail of those arrangements.
“Tabcorp will review the documents disclosed in order to assess whether or not to commence legal proceedings against Entain or AHA NSW, or both, in the Supreme Court.”
The case first began in November 2022 after Tabcorp took issue with its rival’s arrangement with the AHA NSW, which it claimed had violated its own exclusive agreement with the association.
Under Tabcorp’s arrangement, the firm is the sole operator of TAB wagering machines in pubs and hotels, whilst Entain’s deal revolves around advertising.
The FTSE100 company was permitted by the AHA NSW to promote the online betting services available on its Ladbrokes and Neds bookmaker sites, with association CEO John Whelan saying that the deal would ‘finally give NSW hotels competition and choice’.
Entain also planned to operate ‘mates zones’ themed around its Ladbrokes and Neds offerings, including ‘Ladbrokes Lounges’, ‘VIP Ladbrokes Activation Zones’ and ‘Neds Club Lounges’.
It was also released in court that AHA NSW had written a letter to Tabcorp in October 2022 stating that it ‘is committed to support Tabcorp’s exclusive and long-term retail wagering licence in NSW hotels.
The letter continued: “It also remains our position that none of the arrangements as announced by AHA NSW and Entain do anything to undermine Tabcorp’s retail exclusivity, nor are they in contravention of any laws, including the Unlawful Gambling Act.”
However, Tabcorp argues that it was not given ‘sufficient’ information about the agreement, particularly around the advertising elements of it, by either Entain or the AHA NSW.
Legal representatives R C A Higgins SC with B Lim said: “Tabcorp operates in venues such as pubs and clubs, which provide TAB facilities as part of their entertainment offering, alongside food and beverages. Tabcorp pays commissions to venues and makes capital investments, including in fit out to create a place of betting within a venue.
“Tabcorp’s operations in venues account for a substantial proportion of Tabcorp’s revenue. The operations can, but do not necessarily, involve human operators. Some Tabcorp venues rely solely on electronic betting terminals, or customers using their personal mobile devices in ‘Venue Mode’ – a digital retail setup which links a customer’s physical location in a venue with their personal mobile device / TAB account.
“Tabcorp has distribution agreements with venues which mostly prohibit the venue from engaging in other wagering business.”
Concluding his assessment of the case, Judge Stevenson ordered that Entain and the AHA NSW give ‘preliminary discovery’ of documents ‘constituting, recording or evidencing legal advice’ received by the bookmaker.
Additionally, the partners must allow Tabcorp to view documentation detailing how the aforementioned ‘mates zones’ and themed ‘lounges’ will operate.
Lastly, Tabocrop will be able to view documents showing how Entain had ‘reasonable grounds’ for statements made regarding ‘an exciting new way to promote a choice’ and that NSW pubs entering into sponsorship deals with the firm would not ‘offend Tabcorp’s retail exclusivity’ in the state.
The Judge did add, however, that ‘otherwise, Tabcorp’s application should be dismissed’, but as mentioned above, Tabcorp has confirmed that it is evaluating whether to proceed with further legal measures.