European Bookmakers Prevail in IP Cases

14 July 2005

Verdicts reached this week in two separate court cases involving intellectual property rights have given European bookmakers cause to celebrate.

In the bigger of the two cases, the British Horseracing Board lost in its battle to require bookmakers to pay a fee to use racing data. The board took U.K. bookmaker William Hill to court in 2000 in hopes of extracting fees out of William Hill for using racing data (on everything from starting fields to jockeys) on its betting Web site. The battle made its way to the British Court of Appeals, which heard the case on June 28 and ruled Tuesday that the information wasn't protected under data rights laws.

The ruling, a unanimous verdict from Lord Justices Pill, Clarke and Jacob, could have a major impact on the racing industry, which was hoping to extract usage fees from bookmakers to help offset projected losses upon the expiration of the current tax levy in 2009. (The government has made it clear that the levy will be abolished when it expires.)

All three judges cited precedent in the European Court of Justice in siding with William Hill.

"I am conscious that I have agreed to allowing an appeal against a decision which I was inclined to think was correct when the case was last before the Court Of Appeal in July 2001," Lord Justice Clarke said in handing down his decision. "The reason for my change of view is, of course, the decision and reasoning of the ECJ. The whole point of a reference to the ECJ was to ensure, so far as possible, that the relevant directive is construed in the same way throughout the European Union."

Adding to the board's woes, the same panel of judges ruled in an afternoon hearing that the majority of the costs absorbed by William Hill in defending its stance, rumored to be £800,000, must be paid by the board.

Further, the board is expected to take another financial hit, as data rights contracts with Irish bookmakers have already gone into effect, and those contracts remain in question. The board is adamant that the contracts are binding (despite Tuesday's ruling), but a court case pending in Dublin could force the board to return the payments.

Last year the board received more than £17 million in commercial income from data deals with bookmakers in the United Kingdom and elsewhere.

BHB Chairman Martin Broughton called Tuesday a "black day" for racing, but stressed that there is no crisis.

"We have had time to look at the judgment, and it basically seems to come down to the difference between data that is created, obtained and verified," Broughton said. "Essentially what we need to reflect upon is exactly what sort of database could charge for data because if this one can't, then actually we can't think of one that can."

The bookmakers argued that the data they used isn't "owned" by anyone, because a list of starters and riders can be found in any U.K. newspaper.

The court agreed, citing the ECJ's opinion that there is a difference between the "creation" of data in sending out lists of declared runners and riders and the "compilation" of data, for example in receiving initial entries five days before a schedule race.

BHB Chief Executive Greg Nichols said the industry must now tap other revenue streams to stay afloat.

"There has still got to be a commercial agreement," Nichols said. "British racing, the best racing in the world, is worth £750 million gross a year to British bookmakers. That tells me there is something there--something of substance--to sell.

Real Madrid Loses IP Case

In a separate case, Spanish football club Real Madrid lost a court battle in France over the use of the names and images of five of its star players on sports betting Web sites.

The club brought the case before the Court of Paris on behalf of players David Beckham, Zinedine Zidane, Figo and others after their images were used on sports betting sites.

The club brought a slough of cases throughout Europe against Ladbrokes, BetandWin, Villa La Palma, Victor Chandler, Betfair, Sportingbet, William Hill and Mr. Bookmaker, but the Court of Paris ruled that the sites weren't using the images and names for commercial purposes.

Didier Dewyn, chief executive for Mr. Bookmaker, said the ruling should be good news for operators engaged in similar battles.

"This is an important precedent for all similar pending cases in Belgium, France and Germany," Dewyn said. "The legal system in France is one of the most protective environments for names and portrait rights across Europe."

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