Tabcorp Holdings Limited v Sportingbet Australia Pty Limited
[2010] FCA 1123
FEDERAL COURT OF AUSTRALIA
Tabcorp Holdings Limited v Sportingbet Australia Pty Limited [2010] FCA 1123
Citation: Tabcorp Holdings Limited v Sportingbet Australia Pty Limited [2010] FCA 1123 Parties: TABCORP HOLDINGS LIMITED (ACN 063 780 709) and TAB LIMITED (ACN 081 765 308) v SPORTINGBET AUSTRALIA PTY LIMITED (ACN 092 468 883) File number: NSD 1309 of 2010 Judge: EDMONDS J Date of judgment: 15 October 2010 Legislation: Trade Practices Act 1974 (Cth) s 52 Date of hearing: 14 October 2010 Place: Sydney Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 31 Counsel for the Applicants: Mr R Beech-Jones SC with Mr N Bender Solicitor for the Applicants: Freehills Counsel for the Respondent: Mr JM Ireland QC with Mr MJ Heath Solicitor for the Respondent: MWA Lawyers Pty Limited
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1309 of 2010
BETWEEN: TABCORP HOLDINGS LIMITED (ACN 063 780 709)
First ApplicantTAB LIMITED (ACN 081 765 308)
Second ApplicantAND: SPORTINGBET AUSTRALIA PTY LIMITED (ACN 092 468 883)
Respondent
JUDGE:
EDMONDS J
DATE OF ORDER:
15 OCTOBER 2010
WHERE MADE:
SYDNEY
On the applicants giving the usual undertaking as to damages, THE COURT ORDERS THAT, until further order:
1.The respondent by itself, its servants or agents or otherwise is restrained from participating in the dissemination or broadcast in Australia of the advertisements contained on the compact disc which is attached to the Application dated and filed 6 October 2010 and marked ‘Attachment A’.
2.The respondent by itself, its servants or agents or otherwise is restrained from participating in the publication or dissemination in Australia of the print advertisement which is attached to the said Application and marked ‘Attachment D’.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1309 of 2010
BETWEEN: TABCORP HOLDINGS LIMITED (ACN 063 780 709)
First ApplicantTAB LIMITED (ACN 081 765 308)
Second ApplicantAND: SPORTINGBET AUSTRALIA PTY LIMITED (ACN 092 468 883)
Respondent
JUDGE:
EDMONDS J
DATE:
15 OCTOBER 2010
PLACE:
SYDNEY
REASONS FOR JUDGMENT
INTRODUCTION
On 6 October 2010, the applicants filed an application in this Court seeking declaratory and injunctive relief. They sought a declaration that the respondent (‘Sportingbet’) by way of television/internet, radio and print advertisements had contravened s 52 of the Trade Practices Act 1974 (Cth) (‘the TPA’) and an injunction permanently restraining Sportingbet by itself, its servants or agents or otherwise from participating in the publishing, dissemination or broadcast in Australia of any of the advertisements.
This proceeding concerns current advertising which Sportingbet is broadcasting and publishing to promote its business in Australia, specifically its ‘MaxiDiv’ product. There are five advertisements:
(1)An advertisement broadcast on television and on Sportingbet’s website;
(2)a radio advertisement that has aired on commercial radio stations;
(3)two print advertisements that Sportingbet has caused to be published in the Sydney Morning Herald (‘the SMH’);
(4)a different print advertisement that Sportingbet has caused to be published in ‘Best Bets’, a racing publication
(collectively referred to as ‘the advertisements’)
The applicants also sought an injunction permanently restraining Sportingbet by itself, its servants or agents or otherwise from participating in the publishing, dissemination or broadcast in Australia of any of the following representations said to be contained in the advertisements:
(1)People who bet in the New South Wales totalisator pool or the SuperTAB totalisator pool will receive less in their winnings than the advertised final NSW tote dividends or SuperTAB tote dividends, if they win;
(2)people who bet in the NSW totalisator pool or the SuperTAB totalisator pool will have their anticipated winnings reduced by around 16%, if they win;
(3)a consumer’s winnings will be 16% higher with Sportingbet than with the NSW totalisator pool or the SuperTAB totalisator pool because Sportingbet does not charge commission;
(4)Sportingbet’s odds are always higher than the dividends of the TABs;
(5)the applicants retain around 16% of a winning customer’s money in profit; and
(6)consumers cannot place bets in the NSW totalisator pool or the SuperTAB totalisator pool through the internet or a mobile phone.
On 14 October 2010, I heard an application for interlocutory relief in terms of the injunctive relief sought in the application.
At the conclusion of the hearing I indicated to the parties that if I was disposed to grant injunctive relief, I would only be prepared to do so in respect of the advertisements and that I would not be prepared to grant injunctive relief on an interlocutory basis to generally restrain Sportingbet from participating in the publication, dissemination or broadcast in Australia of representations of the kind referred to in [3] above. Apart from anything else, in my view, none of the advertisements contain a number of these representations.
BACKGROUND
Sportingbet is the holder of a Northern Territory’s sports bookmakers licence which accepts bets by telephone or over the internet on races, sporting and other events.
The first applicant (‘Tabcorp’) holds an exclusive licence to conduct the off-course totalisator and a licence to conduct on-course totalisators in Victoria. The second applicant (‘TAB’) is Tabcorp’s wholly owned subsidiary which holds the exclusive licence in New South Wales to conduct the off-course totalisator and a licence to conduct on-course totalisators in that State. The applicants claim that the advertisements which Sportingbet commenced in the week beginning 12 September 2010 involve contraventions of s 52 of the TPA, alleging that representations are made in that advertising which are misleading or deceptive or likely to mislead or deceive within the meaning of the statute. Sportingbet denies that the advertisements in question involve misleading or deceptive conduct on its part.
The advertisements are part of an extensive television, radio, website and newspaper campaign by Sportingbet to run until at least 10 November 2010. The affects of the alleged misleading advertising – and the need for urgent interim relief – are said to be especially acute by dint of the fact that the advertisements were published immediately before and during the Spring Racing Carnival (which runs from 29 September 2010 to 21 November 2010 and incorporates the Melbourne Cup, this year held on 2 November, among other prominent horse races).
The applicants’ business includes the operation of totalisators. In this system of betting, the operator of the totalisator pools all wagers on a particular bet (for example, that a certain horse will win a race) and then deducts a ‘take out’. The balance of the pool is distributed to winning punters as dividends. Indicative or approximate dividends are published prior to the close of betting. The final dividend can be calculated when the betting pool is closed at race time.
According to Sportingbet, its ‘MaxiDiv’ product involves paying a dividend to winning punters based on the ‘better of the highest official Win dividend’ paid by the three State TABs (being the first two applicants and ‘Unitab’) or the official bookmaker starting price on a particular event. It is available for all metropolitan horse racing in Sydney, Melbourne, Brisbane, Adelaide and Perth.
THE ADVERTISEMENTS
The First Advertisement (television/website)
The first advertisement (‘the First Advertisement’) has been broadcast on television and on Sportingbet’s website. For the purposes of the hearing it was reproduced on a compact disc which is Ex ‘IMM-1’ to Ex 1.
The First Advertisement depicts a man described as ‘Sullo’ (who is Mr Michael Sullivan, Chief Executive Officer of Sportingbet) speaking the following words:
‘Sullo from Sportingbet here and I’ve got something to say about punting with the TAB. Putting your bets on at the TAB means letting them take around 16% of your money – which is a big chunk of change to lose when you win. But with Sportingbet MaxiDiv you’ll get the best of the three totes and the official starting price, you’ll get all your winnings untouched and you can place your bets online or on your mobile. I say there is no better bet than a Sportingbet.’
Behind Mr Sullivan is depicted a man in charge of a pie stand who takes one of the pies, adds sauce and bites a chunk out of it. He hands the pie to Mr Sullivan who passes it on to an assistant. The pie is visible in the advertisement and as it is passed to and by Mr Sullivan, the words are spoken ‘which is a big chunk of change to lose when you win’.
The First Advertisement has been broadcast frequently on free-to-air television from 15 September 2010 in Sydney, Melbourne, Perth, Brisbane and Adelaide.
The Radio Advertisement
Exhibit IMM-1 to Ex 1 also contains a radio advertisement (‘the Radio Advertisement’) that has aired on commercial radio stations. The Radio Advertisement features ‘Sullo’ speaking the following words:
‘Sullo from Sportingbet here. With Sportingbet MaxiDiv you always get the best of the three totes and the official starting price. The TAB on the other hand can pocket about 16% of your money. You can bet from anywhere, either online or on your mobile so you never have to miss out on your favourite events. So when you put it all together you are actually miles in front. So that’s why I say there is no better bet than a sporting bet.’
The First SMH Advertisement
On 27 September 2010, Sportingbet caused to be published in the SMH the advertisement reproduced in annexure ‘D’ to Ex 1 (‘the First SMH Advertisement’).
The First SMH Advertisement sets out in large text the words: ‘0% COMMISSION, EVERY RACE, EVERYDAY’. It depicts a table comparing dividends actually paid by the New South Wales, Victorian and Queensland totalisators and by Sportingbet to punters who had purchased the MaxiDiv product. The ‘DIFF’ column in the table purports to set out the difference, expressed as a percentage, between the MaxiDiv dividend and the smallest of the three dividends paid by the totes.
The fourth column, entitled ‘SP’, contains the official starting price.
The Second SMH Advertisement
On 4 October 2010, Sportingbet caused to be published in the SMH the advertisement reproduced in annexure ‘E’ to Ex 1 (‘the Second SMH Advertisement’).
The Second SMH Advertisement is largely identical to the First SMH Advertisement. The contents of the table are different but the basis upon which it has been constructed is the same. It includes a disclaimer in very fine print:
‘Difference calculated as a % based on the difference between Sportingbet’s MaxiDiv and the lowest of any declared State Tote Dividend and the official starting price (SP).’
The Best Bets Advertisement
On 25 September 2010, Sportingbet caused to be published in ‘Best Bets’, which is a racing publication, the advertisement reproduced in annexure ‘F’ to Ex 1 (‘the Best Bets Advertisement’).
Underneath a photograph of a pie from which a large bite has been taken, the Best Bets Advertisement states:
‘SULLO SAYS
DON’T LET THE TAB TAKE A CHUNK OUT OF YOUR MONEY.
Sportingbet MaxiDiv gives you the best of the 3 totes, the official starting price and your money is untouched.’
IS THERE A SERIOUS QUESTION TO BE TRIED?
First Advertisement (television/website)
I am satisfied that there is a serious question to be tried in relation to whether this advertisement contravenes s 52 of the TPA. It is, in my view, strongly arguable that the sentence:
‘Putting your bets on at the TAB means letting them take around 16% of your money – which is a big chunk to lose when you win’
when it uses the words ‘your money’ would be understood, by an ordinary reasonable member of the class to which the advertisement is directed, to mean ‘your winnings’. One is impelled to the strength of such an argument by the sentence which immediately follows:
‘But with Sportingbet MaxiDiv … you’ll get all your winnings untouched …’
It is common ground that the business model of the applicants does not involve any deduction or ‘take out’, as it is called, from the moneys won by a winning punter. That is what, in my view, the two sentences, read together, represent and, if my view is correct, then the First Advertisement is, to that extent, misleading.
Second Advertisement (radio)
I am also satisfied that there is a serious question to be tried in relation to whether this advertisement contravenes s 52 of the TPA. The argument is not as strong as it is in the case of the First Advertisement but, in my view, it is arguable that the sentence:
‘The TAB on the other hand can pocket about 16% of your money’
when it uses the word ‘your money’ would be understood, by an ordinary reasonable member of the class to which the advertisement is directed, to mean ‘your winnings’.
Such an understanding is promoted by a subsequent sentence taken from the text of the advertisement:
‘So when you put it all together you are actually miles in front.’
As I said in [23] above, it is common ground that the business model of the applicants does not involve any ‘take out’ from the moneys won by a winning punter. That is what, in my view, the first sentence assisted by the second, represents and, if my view is correct, then the Second Advertisement is, to that extent, misleading.
The First and Second SMH Advertisements
I am not satisfied that there is a serious question to be tried in relation to whether these advertisements contravene s 52 of the TPA. Much was made of the prominent words: ‘0% commission’, but unlike the first two advertisements, there is no real comparative context with the applicants’ business model. The table in each advertisement is a discrete item and reflects, subject to arithmetic error, what is in fact the truth of the matter. Moreover, the ‘0% commission’ on winnings so far as Sportingbet is concerned is absolutely correct; it does not, in my view, absent any comparative context, carry any representation that the applicants ‘take out’ commission on winnings.
The Best Bets Advertisement
On the other hand, this advertisement falls into the same category as the first two. The prominent sentence:
‘DON’T LET THE TAB TAKE A CHUNK OUT OF YOUR MONEY’
juxtaposed against the less profiled sentence:
‘Sportingbet MaxiDiv give you the best of the 3 totes, the official starting price and your money is untouched’
arguably gives rise to the same misleading representation as the first two advertisements.
BALANCE OF CONVENIENCE
The balance of convenience favours the grant of interim relief in respect of the first two advertisements and the fifth, on the applicants giving the usual undertaking as to damages.
CONCLUSION
I therefore propose to make orders in the terms proposed by the applicants, limited of course in the fashion I have previously foreshadowed in these reasons.
I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds. Associate:
Dated: 15 October 2010
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