This Thursday, the Superior Court Judge Joan Zeldon granted the request of local citizens to put on hold a five year $215 contract awarded to Intralot to launch a mobile sports betting product. The first $30m installment for the no-bid contract was due on October 1, but that payment is now on hold.
DC Resident Dylan Carragher was the one who challenged the contract in court, as he designed his own mobile sports betting application and was hoping to bid on the DC Lottery betting contract.
The suit was based on his understanding that the DC Home Rule Act required a competitive bidding process before awarding out the financial benefits. The District’s betting legislation offered Intralot an exemption to this requirement, the latest in a long string of questionable benefits that DC has bestowed upon the Greek company over the years.
Judge Zeldon admitted that it was likely that Carragher would be successful in terms of proving that the DC Council was not following the Home Rule Act. The restraining order issued by Zeldon is valid for two weeks and the hearing is due to take place from 1 October.
A number of Council members have made statements celebrating Zeldon’s ruling, with Mary Cheh slamming the “shoddy and unscrupulous circumstances that led to this contract.” Councilman David Grosso called the whole episode “a boondoggle from the very beginning.”
The DC Council’s Intralot decision was criticized from August when the company’s partner Veterans Services Corp (VSC) was busted for being a shell company that actually had no employees and was run by a Maryland-based employee of an Intralot subsidiary. Questions were raised about Intralot’s financial situation after the loss of a lottery contract in Turkey and their capacity to carry on operations.
Intralot’s mobile betting product was supposed to be ready by January 2020, but with this held back this timeline is in serious doubt. More than that, the contract will end on September 30, so the legal issue will impact the company’s operations.
DC’s betting legislation offered the Intralot/DC Lottery combo a virtual monopoly on digital wagering but also authorized land-based wagers at local bars and sports venues, as well as limited mobile wagering within a two-block radius of each venue. It’s unclear what impact, if any, the current legal kerfuffle might have on the rollout of those retail operations but any delay in the DC Lottery getting its digital ops up and running could possibly give the venues’ mobile ops a fighting chance at establishing customer relationships.
