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Implications Of Landmark Sportradar Lawsuit Unclear On US Sports Betting Market

Prominent sports data company files suit against chief rival, top English football league

Matt Rybaltowski by Matt Rybaltowski
March 4, 2020
in Legal
sports betting data

(Shutterstock)

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Sportradar initiated legal proceedings Wednesday against Betgenius and London-based Football DataCo, firing the latest salvo in the highly contentious global sports data war.

The claim relates to the structure for the licensing and distribution of live data from Football DataCo’s (FDC) leagues for sports betting purposes, Sportradar said in a statement. Essentially, the company alleges that its competitor Betgenius is shutting Sportradar out from collecting and furnishing data on certain leagues’ games, and in so doing, violating UK and EU competition law.

β€œThis competition is vital for innovation, genuine product choice and fair pricing and we believe these elements are worth protecting; the step Sportradar has taken is focused on that outcome,” Sportradar said.

‘Sportradar supports a competitive marketplace’

Football DataCo oversees the organization of data distribution for three football leagues – the English Premier League, the English Football League (EFL), as well as the Scottish Professional Football League (SPFL). Last May, Genius Sports inked a long-term deal with FDC that gave the company exclusive rights to collect, license and distribute live data from all three leagues to global sportsbook operators, according to a statement announcing the deal.

Betgenius is the sports betting division of London-headquartered Genius Sports.

Sportradar, a Switzerland-based multinational data provider, initially threatened legal action against the two parties in September on the basis that an agreement that gives a company exclusivity to data collection in a stadium β€œinfringes upon UK and EU competition law.” Sportradar, the parent company of Sportradar US, detailed the claims last September in a 20-page letter obtained by The Sunday Times of London.

Sportradar is one of the world’s largest third-party providers of sports betting data. Since the Supreme Court’s historic PASPA decision in May 2018, Sportradar has secured multiyear betting data partnerships with the NFL, the NBA, the MLB and several other prominent leagues.

“Sportradar is, and has always been, willing to pay for access, and to be part of an integrated, accredited, and fair system of collection and distribution which enables competition. Sportradar believes that the system put in place by Betgenius and FDC does not allow for this outcome; and that the current arrangements are in breach of UK and EU Competition Law,” the company added.

The ubiquity of sports betting data

Given the proliferation of in-game betting, the need to secure a fast, reliable data feed has become a necessity for many sportsbooks worldwide. As such, sports betting data is viewed as the fuel that powers in the in-game engine.

β€œData has become a ubiquitous part of our everyday existence now,” said David Lampitt, managing director of group operations at Sportradar on a September webinar.

While Lampitt did not address a potential lawsuit against the parties on the webinar, he did discuss the outcome of a 2012 decision in the Court of Justice of the European Union (ECJ). In Football Dataco vs. Sportradar, the Court found that Sportradar’s usage of data owned by Football Dataco could be classified as “re-utilisation” under Article 7(2)(b) of its Database Directive.

Article 7(2)Β – infringement occurs if there is either:

  • “extraction” – permanent or temporary transfer of all or a substantial part of the contents of a database to another medium by any means or in any form; or
  • “re-utilisation” – any form of making available to the public all or a substantial part of the contents of a database by on-line or other transmission, distribution of copies or renting. — 2012 ECJ decision

In response, Lampitt said on the webinar that Sportradar respects the outcome of the case and has positioned its business accordingly. Furthermore, Lampitt emphasized that Sportradar has sought to take action against companies that attempt to infringe against its database.

Based on ticketing protocols, venues that have struck data rights agreements with various professional sports leagues ostensibly believe they have the right to eject unauthorized data scouts from the grounds. The scouts, they say, are contravening ticketing agreements by transmitting “stolen” data that is quickly disseminated to the global sports betting market.

The practice received considerable media attention last summer when a firm named Comsec Investigations ejected a fan from an early-season Hull City match. The fan, according to media reports, did not engage in data scouting but was simply texting his girlfriend and members of his family from the stands.

At half time a man in casual gear followed by a steward, came up to me and said β€˜tell me what this says’

holding a badge up that said security. I said (spoiler alert)

β€˜…security?’

— Daniel Mawer (@skintnortherner) August 10, 2019

Nevertheless, approximately 200 data scouts were ejected from English football matches this season through early-October, a source told Sports Handle.

“The industry needs to grow up, it needs to stop sending guys in hoodies with earpieces who are taking data from games,” the source said.

Overseas implications in the U.S.

At the moment, the ramifications of the legal proceedings on the U.S. sports betting market are unclear. It is also unclear if the protections that are in place for data companies in Europe are internationally recognized by courts in other jurisdictions throughout the world.

But in the U.S., First Amendment and free speech concerns have set precedents that are largely viewed as unfavorable for those seeking to buy and protect information and facts about sporting contests.

One development to watch closely revolves around the data rights for Premier League wagering in the U.S. Numerous books offer in-game betting for the world’s most popular soccer league. If U.S. sportsbooks are forced to pay an additional fee for Premier League data, the odds and pricing for league matches may be affected.

Secondly, the monitoring of illegal data scouts on U.S. soil could intensify in the coming months. Will security firms similar to Comsec Investigations conduct trial runs at major events such as next month’s Final Four? In fact, this kind of monitoring is already occurring in the U.S. Per Tony Batt and Matt Carey in a March 4 report in Gambling Compliance, “Individuals who supply unofficial sports-betting data at home games of the Atlanta Falcons of the National Football League are being watched by team officials, Falcons president and CEO Rich McKay told a Georgia Senate Committee on Tuesday.”

In addition, competitors of Sportradar may argue that the lawsuit opens the possibility that their data scouts could collect open-sourced data from NFL and NBA venues for distribution to betting partners.

A spokesperson from Genius Sports did not comment on Wednesday’s lawsuit.

This legal entanglement between Sportradar and Betgenius in the UK is also rich with irony. It is occurring at a time when U.S. leagues have sold certain rights to both companies to distribute game data. Meanwhile, pro sports leagues, led by the NBA and MLB, are bearing down and lobbying state legislatures across the country, seeking to restrict anyone but their own partners from distributing data to sportsbooks — by governmental mandate, claiming that “official league data” is the only true and reliable source for legal sportsbooks.

The leagues have been successful in this lobbying effort so far in three states: Tennessee, Illinois and Michigan. However, legalized sports betting has yet to go live in any of the three even though a 2020 launch has not been ruled out.

Some operators have already aligned with the leagues and have purchased the official data packages, becoming “authorized gaming operators.” But other operators have argued vehemently against such a mandate. In those three states, to no avail.

As a result, the contours of commercial terms between “official” suppliers and licensed sportsbooks, and whether or under what terms live sports data constitutes free speech in the U.S., remains up in the air.

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Matt Rybaltowski

Matt Rybaltowski

Matt is a veteran writer with a specific focus on the emerging sports gambling market. During Matt's two decade career in journalism, he has written for the New York Times, Forbes, The Guardian, Reuters and CBSSports.com among others. In his spare time, Matt is an avid reader, a weekend tennis player and a frequent embarrassment to the sport of running. Contact Matt at [email protected]

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