Lawsuit alleges conspiracy to favor computer bettors
Colorado horseplayer Ryan Dickey filed a class-action lawsuit Friday in a federal court in New York alleging a conspiracy between racetracks, advance-deposit wagering providers, tote companies and computer-assisted wagering providers to favor batch-betting teams over retail players.
The Stronach Group, Churchill Downs Inc. and New York Racing Association were the racetrack owners named as defendants. So were CAW providers Elite Turf Club, owned by Stronach and NYRA, and Racing and Gaming Company Services, which is based in St. Kitts and Nevis. Stronach’s AmTote and Churchill’s United Tote, who are tote providers, also were named as defendants.
Flatter: Computer players are in season at Keeneland.
Spokespersons for Stronach and Churchill referred Horse Racing Nation’s requests for reaction to their companies’ legal teams. A NYRA spokesperson had not yet responded. A contact for the Racing and Gaming Company was unavailable Friday.
Dickey filed the lawsuit on behalf of himself and similarly situated horseplayers. The lawsuit defines the class of plaintiffs eligible to join the suit as “all persons in the United States who placed wagers into CAW-impacted betting pools on Thoroughbred horse races while not using a CAW account.”
Dickey is represented by the firm Hagens Berman Sobol Shapiro, and the complaint was signed by attorney Anne Johnson in New York.
The lawsuit alleges a broad conspiracy between racetrack and ADW operators, tote providers and computer-assisted wagering providers to cater to computer wagering teams and allow them to bet on better terms than the average retail bettor. Those improved terms include faster and more thorough access to pool information, the ability to place wagers more quickly and at higher volume than retail bettors can via dedicated, low-latency links and offers of rebates that lower betting takeout to levels far below the general public must pay.
According to the suit, this hurts non-computer bettors in several ways. Odds swing sharply near or even just after post time, meaning retail bettors do not have an accurate idea of their price before placing their bets. Retail bettors do not have the same visibility into inefficiencies or overlays in all pools like CAW bettors do. Retail bettors cannot bet as quickly over a web interface, telephone or betting window compared to batch betting over dedicated lines. And, because of the takeout discrepancies after CAW rebates, many of the same strategies that are profitable for computer players are losing strategies for retail bettors.
The suit also points out some of the defendants' recent actions as evidence that they know CAW teams short-change retail bettors. Those actions include NYRA and Santa Anita freezing CAW teams out of win pools in the final minutes before post, NYRA freezing CAW teams out of the late Pick 5 and a statement by CAW provider Elite Turf Club to the California Horse Racing Board admitting that the presence of CAW teams effectively raises retail takeout.
The suit alleges four counts against all of the defendants in the case. Those counts include violation of the Racketeer Influenced and Corrupt Organizations Act, conversion, unjust enrichment and conspiracy. Conversion is a legal term meaning taking someone else's property with the intent to deprive them of it, while unjust enrichment refers to a party conferring a benefit upon another without the other providing what they are legally supposed to provide in return.
The lawsuit asks for remedies including base compensatory damages, treble damages as punishment for egregious behavior, a corrective notice program and any other relief that the court finds appropriate.
The full text of the suit is available online.
Dickey formerly worked for Horse Racing Nation as an online producer.