Lawsuit Alleges Horse Racing Industry Collusion to “Defraud” Everyday Bettors

A new lawsuit filed by Hagens Berman, a law firm representing the interests of ordinary bettors, accuses some of the biggest names in the horse racing industry of knowingly colluding to give preferential treatment to anonymous gamblers who use computer-assisted wagering (CAW) platforms at the expense of everyone else.

Horseracing Giants Targeted in New Lawsuits Alleging Foul Play

This amounts to defrauding ordinary gamblers, the complaint seeks to prove to the US District Court for the Eastern District of New York. The lawsuit also names the Stronach Group, Churchill Downs, and the New York Racing Association (NYRA) as co-conspirators in what the lawsuit alleges is an elaborate scheme.

The lawsuit also targets data clearinghouses – AmTote International and United Tote, owned by Stronach Group in the case of the first, and Churchill Downs and NYRA in the case of the second. The complaint argues that users who place their wagers through CAW platforms are given an unfair advantage over ordinary gamblers.

What is more, the identity of those users is not known, nor is there a source of wealth, argues the complaint, citing the Racketeer Influenced and Corrupt Organizations Act, as another possible breach of contract.

CAW Platforms Could Be Putting Ordinary Gamblers at a Disadvantage

Because horse racing odds are set by the bettors themselves, this means that there is room for manipulation, which could put ordinary customers at a disadvantage and mislead them.

Betting activity alone is enough to sway the odds, the complaint adds. What is more, gamblers who use CAW platforms are also charged lower fees; they are seemingly betting at a rapid pace and only seconds before a race starts, and users at such platforms also enjoy rebates.

The complaint goes a step further to allege that this type of gambling is “no-risk, no-loss” for those who benefit from the CAW platforms per se, but pretty much puts everyone else at a disadvantage.