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A day at the races ends in tears

Heidi Hurdle
06/06/2019

Locations

United Kingdom

A dispute over horse racing data ended in tears last month for the defendants who were hit with a wide range of claims. Although the claims for copyright and database infringement failed, the defendants fell at the last hurdle when the breach of confidence claim turned against them.

A dispute over horse racing data ended in tears last month for the defendants who were hit with a wide range of claims. Although the claims for copyright and database infringement failed, the defendants fell at the last hurdle when the breach of confidence claim turned against them.

Brief overview

The facts of this case are fairly complex involving two actions, and several claimants and defendants, although by the time of the trial the only remaining defendant was Sports Information Services Ltd (SIS) (the others having settled with the claimants.) (See the judgment for all the details: Racing Partnership Ltd and others v Done Brothers (Cash Betting) Ltd and others [2019] EWHC 1156 (Ch)). 

The Racing Partnership Ltd (the first claimant) produced live betting and horse racing data collated at racecourses under agreements with the course owners and sold it to off-course bookmakers. Its right to conduct this business with the second claimant, Arena Leisure Ltd, the owner of six racecourses had began in January 2017.

The dispute involved two types of horse racing data:

  • Betting Shows: the representative fixed price for each horse in a race. Each Betting Show is the product of an algorithm (which essentially calculates a form of average price) into which is fed a selection of the fixed odds being offered by a sample of on-course bookmakers.
  • Raceday Data: information specific to the racecourse on the day of the race, such as the weather conditions, the state of the course, the withdrawal of any horses, the start and finish time, and the result.

Until the end of 2016, SIS had been able to collect and distribute Betting Shows and Raceday Data to off-course bookmakers under an agreement with Arena Leisure. From 1 January 2017, it no longer had any contractual arrangement with Arena, but continued to provide both types of data, collecting the Raceday Data through an agreement with the Tote (one of the other defendants).

The claimants basically threw the book at the defendants alleging infringement of copyright, infringement of sui generis database right, breach of contract, conspiracy, and finally breach of confidence. In this blog we look briefly at what happened to the copyright, database and breach of confidence claims only. (The conspiracy and breach of contract claims failed.)

High Court ruling

Mr Justice Zacaroli's judgment is not short – over 300 paragraphs, plus an appendix – not really surprising for a case where the trial lasted about a fortnight! In the judgment, he deals methodically and carefully with each of the claims.

  1. Copyright

Zacaroli J found that there was no copyright in the Betting Shows as original literary works under the Copyright, Designs and Patents Act 1988 (section 3A). Although the list of names selected to be included in the sample used for the Betting Shows might have been protected by copyright, the processing of generating the output of the shows was "pure routine work" and there was not sufficient skill and labour. The judge found that the situation was analogous to that in Bookmakers' Afternoon Greyhound Services Ltd v Wilf Gilbert (Staffordshire) Ltd [1994] FSR 723 concerning forecasts for greyhound meets.

Even if copyright had subsisted in the Betting Shows, the judge was not satisfied that it had been infringed by SIS. SIS had merely consulted the Betting Shows in the 8-10 minutes before each race so that its own shows were closer, but not the same as the claimants. This did not amount to taking a substantial part.

  1. Database right

SIS accepted that the claimants had a sui generis database right, but denied that its actions constituted infringement (under the Copyright and Rights in Databases Regulations 1997 (SI 1997/3032)). The judge's decision here mirrored his decision in relation to copyright as the claimants relied upon the same facts.

SIS's actions constituted at most consultation of the Betting Shows, which was not an extraction or re-utilisation of any part of the databases. Referring to the CJEU's ruling in British Horse racing Board Ltd v William Hill Organization Ltd (Case C-203/02) and the question of when repeated and systematic extraction or re-utilisation of insubstantial parts could amount to an infringement, the judge said that even at its very highest SIS's conduct did not reach that threshold.

  1. Breach of confidence

The breach of confidence claim sprung from the Tote's collection and distribution to SIS of the Raceday Data. In determining this claim, the judge applied the classic three-stage test set out in Coco v AN Clark (Engineers) Ltd [1969] RPC 41, as follows:

(i) The information must have the necessary quality of confidence

Zacaroli J considered that there were strong parallels between this case and that of the well known House of Lords' decision concerning the wedding photos of Michael Douglas and Catherine Zeta-Jones (Douglas v Hello! Ltd (No.3) [2008] 1 AC 1).The racecourses were the private property of Arena, which imposed restrictions on how the information and data arising from its racecourses could be seen. While the information was collected for the purpose of public dissemination, there was no doubt in the judge's mind that the information had substantial commercial value, just for the short time before the race started. Consequently, he concluded that there was commercial confidentiality in the Raceday Data even though it was not inherently confidential.

(ii) It must have been imparted in circumstances importing an obligation of confidence

The judge was satisfied on the facts that this requirement was met (an objective test). He also found that SIS knew or should have known of the confidentiality of the information.

(iii) There must be an unauthorised use of the information to the detriment of the rights-holder

Again the judge was satisfied on the facts that this requirement was met.

Conclusion: Zacaroli J concluded that SIS was liable to the claimants for having breached the claimants' confidence in the Raceday Data supplied to it by the Tote.

Comment

This dispute illustrates the challenges that litigants can face when pursing claims for infringement of copyright and database rights in relation to sports or similar data. However, organisers of sporting events and other businesses involved in the collection and distribution of live data can be encouraged by the judge's findings in relation to confidential information. Here the information was found to have the necessary quality of confidence, not through its inherently confidential nature, but as a result of it having substantial commercial value and because the claimants had controlled its dissemination via exclusive channels so as to exploit that value. This could give businesses in these fields an additional tool to protect the value of their data against those who misuse it.

As it is relatively rare for cases involving rights in databases to get before the courts, the comprehensive analysis in Mr Justice Zacaroli's judgment will provide a helpful reminder to all parties of the key principles.

 

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