Betting on Live Sports Data

The recent growth of the gambling industry, particularly as a result of the popularity of online betting websites and apps, has brought the ownership and exploitation of live sports data into sharper focus.

Historically, the organisers of sporting events and the official distributors of live data from those events have had to rely largely on a combination of rights to protect the value of their data. However, in the recent decision of The Racing Partnership (“TRP”) & others v Sports Information Services Ltd (“SIS”) [2020] EWCA Civ 1300, the English Court of Appeal confirmed the potential value of live sports data and clarified the potential causes of action a party might use to protect its alleged rights in such data.

Background

The claim originally brought by TRP sought to protect the exclusivity and the value of its raceday data, which includes the going of the course, non-runners and withdrawals, the time of the “off” and the results of each race (“Raceday Data”). TRP had been set up by Arena Racing (the owner of a number of British racecourses) and other independent British racecourses as a rights vehicle to aggregate and exclusively exploit that data. A number of well-known bookmakers contracted directly with TRP to receive the Raceday Data.

However, some of the UK’s biggest and best-known bookmakers instead contracted with SIS, a producer and distributor of data and audio-visual coverage which provided an alternative unofficial data package to off-course bookmakers in respect of races at Arena’s courses, comprising (i) betting odds drawn from other sources, primarily odds comparison websites and online betting exchanges; and (ii) Raceday Data sourced through a contractual arrangement with Tote (Successor Company) Limited (“Tote”). Tote had historic contractual rights to collate data at Arena racecourses and distribute such data to bookmakers. Under this contract, Tote had provided warranties to SIS that it (Tote) had the right to distribute that data onwards.

The Claimants’ Case

Eventually, TRP and Arena (as co-claimants), seeking to protect the alleged exclusivity and value of their data, launched High Court proceedings against SIS. The two main claims that formed the basis of the High Court and subsequent Court of Appeal decisions were:

• A breach of confidence claim, on the basis that TRP’s data was confidential and SIS used it without authorisation; and
• A claim that SIS engaged in an “unlawful means conspiracy” together with major bookmakers and Tote to injure TRP through unlawful use of the data.

Breach of Confidence

In order to succeed in the breach of confidence claim, TRP needed to show that the relevant data had a ‘quality of confidence’ (i.e. that it is the sort of data that can realistically be kept confidential) and that it was imparted to SIS in circumstances ‘importing an obligation of confidence’ (i.e. that the circumstances require the information to be kept confidential).

Having analysed the various issues, the Court of Appeal found that the Raceday Data did not have the necessary ‘quality of confidence’ as the vast majority of it would be obvious to anyone with access to a live television broadcast or a smartphone. For live sports data to be considered potentially confidential, therefore, it is strongly recommended that the owner of the data places robust contractual restrictions on third party distributors. However, it is worth noting that each case will turn on its own facts – in different circumstances and with different data, the Court may consider that the data is of a nature that can reasonably be kept confidential.

Even if data is considered to have a ‘quality of confidence’, it must have been made available in circumstances which make clear that the party to whom the data is imparted must keep it confidential.

In this case Tote, a commercially experienced and reputable company, had provided SIS with assurances and a contractual promise that Tote had no obligation to TRP to keep the Raceday Data confidential. On this basis, the Court concluded that SIS could not have been expected to know that there were in fact restrictions on disseminating the data. Even if the data was of a nature that could reasonably be kept confidential, the circumstances did not impose any obligation on SIS to keep said data confidential.

The outcome of this decision is that (i) it will likely be difficult to prove that live sports data can be kept confidential, and (ii) the owner of live sports data will likely struggle to take action against an unofficial distributor as there is no obligation of confidentiality between those two parties; the owner may instead be forced to take legal action against the party who supplies the data to the unofficial distributor (and who promises the distributor that there were no relevant confidentiality obligations).

Unlawful Means Conspiracy

In respect of the unlawful means conspiracy part of the case, TRP was required to prove that there was a combination or agreement between SIS, the major bookmakers and Tote to take unlawful action with the intention of causing damage to TRP. Additionally, TRP had to prove that it had actually suffered damage as a result. Unlawful action, in this case, meant SIS’s allegedly unauthorised use of data from various online betting exchanges and Tote’s alleged misuse of TRP’s data (it supplied TRP data to SIS for purposes other than those for which it was authorised to supply that data).

When deciding whether there had in fact been an unlawful means conspiracy, the Court focussed primarily on one key issue: whether the alleged conspirators had to know that their actions were unlawful? The court decided that there was no requirement for an alleged conspirator in an arrangement such as this to know that their actions were unlawful. Therefore, a business may be liable for unlawful means conspiracy even where it has no reason to believe that it has acted unlawfully. Generally, businesses should be very careful not to inadvertently breach the terms of their contracts. Following TRP, they could face claims not only from the other party to the contract, but from a third party. This is potentially a major departure from the doctrine of ‘privity of contract’, a keystone of UK law which holds that a contract’s terms can only be enforced by and between the actual parties to the contract. On the other hand, there may be opportunities for businesses to advance claims on for breach of contract where said breach has caused a business harm, even where that business is not a party to the contract.

Comment

The Court of Appeal’s approach in TRP has made it even clearer that businesses who provide live sports data to distributors (particularly in the gambling sector) should ensure that they have robust contractual restrictions in place to protect their data. For example, if TRP had had restrictions setting out the express parameters of Tote’s rights to distribute the data, it would not have needed to rely on causes of action (such as confidentiality or unlawful means conspiracy) that had not been previously tested in this context. On the other hand, TRP has demonstrated that businesses may be able to make use of these causes of action where there are insufficient contractual protections in place.

It should be noted that SIS has filed an application for permission to appeal the finding in respect of unlawful means conspiracy to the Supreme Court, so the position may yet be subject to further change.

If you would like further information or advice, please do not hesitate to get in touch with the Commercial team at Carson McDowell.

*This information is for guidance purposes only and does not constitute, nor should be regarded, as a substitute for taking legal advice that is tailored to your circumstances.