The British horseracing authorities threatened to cut Irish bookmakers off from the "lifeblood" of their businesses in a €20 million row over data licensing rights, a court heard yesterday.
Over 60 Irish betting shop operators are seeking the return of €20 million they paid to the British Horseracing Board (BHB) for a licence to broadcast information on runners, riders and betting odds for individual races from screens in their premises.
The bookmakers believe that the BHB is not entitled to charge them a licence fee for the information, known as pre-race data.
The Commercial Court heard yesterday that when it originally began charging Irish bookmakers the fee in 2002, the BHB warned them that it would have the satellite service which broadcasts the data and the races cut off if they failed to pay. The board said that, without the licence, they would not be authorised to take bets on British racing. This accounts for over half of most Irish betting shops' turnover.
According to bookmaker and former Fine Gael agriculture minister, Ivan Yates, the broadcast information and the races are vital. "The whole display of information is the lifeblood of my business," he said. "If this terminated, there would be nothing to view, nothing to bet on. It would be like having your electricity cut off."
He said that if the BHB, which administers British racing, had acted on its threat, it would have resulted in all the screens in his shops being cut off. Mr Yates, who is spearheading the Irish bookmakers' case against the BHB, said that he and his fellow plaintiffs paid the €20 million to the board because they believed they had no choice. The BHB was relying on an EU directive that protects electronic data. However, a year ago, the European Court of Justice (ECJ) ruled that the directive did not apply to the information that the BHB was supplying to bookmakers. In July, the English court of appeal made the same ruling in the UK.
Brian Murray SC, for the bookmakers, argued that the effect of the ECJ ruling was that the BHB did not have the right to charge the licence fee. He said this meant that both it and the betting shops were originally acting under the mistaken assumption that the BHB it did have this right.
Mr Murray argued this gave the bookmakers the right to terminate their agreements with the BHB and to seek repayment of money paid for the licences. He also claimed that, because of the threat to cut off their satellite service, the bookmakers signed the licensing deal under duress.
Mr Yates told the court that he met BHB representatives, Nigel Smith and Brian O'Farrell, in Dublin in November 2004 to discuss the ECJ ruling. But they told him that the European court had made a mistake and that the subsequent English court of appeal hearing would "correct" this.
Mr Yates has been paying the BHB €25,000 a month, but is recovering up to €18,000 a month from levies imposed in 11 of his 34 shops. He also acknowledged that while the BHB originally charged him on the basis that he was making a 13 per cent profit from British racing, it cut the fee when he was able to show that the margin was, in fact, 9 per cent.
