Richard Desmond loses £1.3bn damages battle over national lottery licence
TL;DR
Richard Desmond has lost a £1.3bn damages claim against the Gambling Commission over the national lottery licence. His legal battle, which began in 2022, claimed the commission made errors in the bidding process.
Key points
- Richard Desmond lost a £1.3bn damages claim
- The claim was against the Gambling Commission
- Desmond's legal costs reached £55 million
- Allwyn won the national lottery licence in 2022
- Desmond argued the commission made errors in the bidding process
Mentioned in this story
The media tycoon Richard Desmond has lost his claim for up to £1.3bn in damages from the Gambling Commission, ending a bitter dispute over the regulator’s decision not to award him the 10-year licence to run the national lottery.
Companies owned by the former proprietor of the UK broadcaster Channel 5 and titles including the Daily Express, Asian Babes and Readers’ Wives launched action against the regulator in 2022, starting a tortuous legal process in which Desmond’s costs were estimated to have reached £55m by May last year.
Lawyers for his Northern & Shell investment company and his lottery bid vehicle, the New Lottery Company (TNLC), argued that the commission made “manifest errors” in the labyrinthine process governing the UK’s largest public sector contract, worth £6.5bn.
The media mogul claimed the commission’s mistakes caused him to incur £17.5m of needless costs in pursuing his bid. However, he was also seeking up to £1.3bn in damages to reflect hypothetical lost earnings from running the lottery.
Allwyn, a new vehicle ultimately owned by the Czech billionaire Karel Komárek, won the 10-year licence in 2022 and has run the draw since 2024.
On Friday, Mrs Justice Smith dismissed Desmond’s claim.
“The claimants have failed to make out any case of manifest error on the part of the commission in their process claim,” she wrote.
“They have also failed to establish that either [previous licence holder] Camelot or Allwyn should have been disqualified from the competition, whether by reason of incumbency advantage (Camelot) or conflict of interest (Allwyn).
“The competition that was conducted for the award of the fourth licence reached a lawful outcome.”
Dubai-based Desmond subsequently launched a series of legal challenges linked to the decision, rejecting a £10m settlement offer.
The former Tory donor and Brexit backer, who invoked EU law in his suit against the commission, claimed that the regulator presided over a flawed process that should have been rerun.
He urged the court to “err on the side of generosity” in assessing his claim for up to £1.3bn in damages, which would probably have been funded from the pot of lottery money allocated to good causes.
Desmond had previous failed with a separate claim that Allwyn had received an unlawful £70m marketing subsidy from the Gambling Commission.
Q&A
What was Richard Desmond's claim against the Gambling Commission?
Richard Desmond claimed up to £1.3bn in damages from the Gambling Commission for not awarding him the national lottery licence.
How much did Richard Desmond spend on legal costs during the lottery licence dispute?
Richard Desmond's legal costs were estimated to have reached £55 million by May 2023.
Who won the national lottery licence that Richard Desmond was contesting?
The national lottery licence was awarded to Allwyn, a company owned by Czech billionaire Karel Komárek, in 2022.
