Published: May 16, 2022

Lawyers for Camelot warn brewing legal battle could hit 'hundreds of thousands' of good causes funded by National Lottery

Good cause?: Lawyers for Camelot said the Gambling Commission is asking the court to 'take a gamble' on the case

Lawyers for Camelot have warned a brewing legal battle could hit 'hundreds of thousands' of good causes funded by the National Lottery. 

The court case, due to be heard later this year in a trial, could mean good causes 'suffer' for up to a decade, according to Lord Pannick QC, who is representing Camelot. 

In a preliminary hearing last week, Pannick urged the judge to take into account the 'risk of damage to the public interest'. 

Lawyers for Camelot said the Gambling Commission is asking the court to 'take a gamble' on the case – which is over the decision to award the latest contract to newcomer Allwyn Entertainment. Camelot lost the licence earlier this year. 

The Mail on Sunday revealed last week that a former Camelot chief has warned the dispute could drain up to £1billion from the central fund for good causes. 

Camelot, which has operated the National Lottery since it began 28 years ago, set out its argument during a two-day 'balance of convenience' hearing last week. 

A High Court judge is set to determine this week whether or not damages will be a suitable award for Camelot. 

At the heart of its case is the claim the Commission got the decision to appoint Allwyn 'badly wrong'. 

Camelot said there is a risk that the 'National Lottery will be run for ten years by an operator who was unlawfully appointed'. Since granting the next licence, the regulator has attempted to usher through the new operator via an 'enabling agreement'. 

This would allow Allwyn, formerly known as Sazka and which is backed by Czech billionaire Karel Komarek, to press ahead with its plan to take over the lottery by 2024. 

Allwyn has vowed good causes will get £38billion over ten years. The regulator has argued Camelot will not lose out financially from a change in operator because 'their losses are quantifiable and will be paid by the defendant in the event that any error with the award is identified'. 

But Pannick said this was a 'particularly potent feature' of the dispute – because for damages 'to come out of the funds available to good causes is a serious public interest detriment'. 

Former Camelot chief executive Dame Dianne Thompson waded into matters prior to last week's hearing, writing a letter to the Gambling Commission. 

She said that delaying the transfer of the ten-year licence was a 'relatively straightforward solution' that would 'avoid any unseemly and unnecessary haste in legal proceedings and remove the risk to good causes'. 

Allwyn was named as the preferred applicant by the Gambling Commission in March. 

The Gambling Commission said: 'We regret Camelot's decision to bring legal proceedings following the outcome of a highly successful competition for the fourth National Lottery licence. The competition and our evaluation have been carried out fairly and lawfully in accordance with our statutory duties and we are confident that a court would come to that conclusion.' 

Allwyn said it 'is complying fully with the Gambling Commission on all aspects of the process'. 

Camelot declined to comment.

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