Australian betting operator Tatts Group has been ordered to repay a $541m judgment it won from the state of Victoria over a cancelled video poker (pokies) machine monopoly.
On Wednesday, the High Court of Australia ruled against Tatts and rival Tabcorp Holdings in their long-running pokies war with the Victorian government. The two operators had held a duopoly on pokies operations in the state outside the Crown Melbourne casino until 2008, when the government announced it would open up the market to competitors in 2012.
Tatts and Tabcorp each sued the state, arguing that they were owed compensation for the unceremonious end of their individual contracts, which covered a combined total of 27,500 machines. The Victorian Supreme Court upheld Tatts’ claim in 2014, awarding the company $541m in damages, while rejecting Tabcorp’s claim for $687m due to the more restrictive language in its contract.
Tabcorp appealed its loss while Victoria appealed the Tatts decision, leading to this week’s date with destiny at the High Court. There is no higher court to which either company can appeal, and thus the curtain has finally fallen on this long-running high-stakes drama.
Tabcorp had already accounted for the sum in its previous financial reports, meaning the company will experience no further pain other than legal bills and embarrassment. Tatts had declined to book its $541m judgment as income until it was sure the money was its to keep, so while it will have to return the cash (plus interest) and pay Victoria’s legal costs, the company says its ability to pay dividends won’t be affected.
In the day’s least surprising outcome, Victoria’s state treasurer Tim Palas declared the court’s decision to be “a great outcome.” Cynics are advised to be on the lookout for an impromptu rise in public sector pay packets.
