Entain compensation case could “improve transparency” in UK gambling sector
Fox Williams, the legal firm fronting up investor claims, suggests case could have a “knock-on effect” for public companies in disclosing information to shareholders
The legal firm spearheading claims for shareholders against Entain for losses sustained relating its historical Turkish business has said the proceedings will “improve transparency and governance” in the UK gambling sector.
Fox Williams has launched a group lawsuit in the High Court of England and Wales against the FTSE 100 operator on behalf of shareholders.
The claims were submitted to the court at the start of August, with shareholders looking to recover compensation relating to a period between 1 July 2011 and 31 December 2023.
The crux of matter lies in the perceived failure on Entain’s behalf to fully disclose to shareholders its operations in Turkey, which ultimately led to a £585m penalty.
A Fox Williams case summary reads: “On 31 May 2023, Entain announced that it was negotiating a DPA [deferred prosecution agreement] with the UK’s CPS [Crown Prosecution Service] in connection with bribery offences following an investigation into its Turkish operations by His Majesty’s Revenue and Customs.
“Subsequently, Entain shares suffered a fall in value.
“Fox Williams’ claim arises from Entain’s failure to report honestly (or at all) to investors regarding its knowledge of (among other wrongdoing) bribery and corruption in Turkey involving Headlong Limited (an Entain subsidiary during the period 2011 to December 2017) and in breach of section 7 of the UK Bribery Act 2010.”
The suit is being led by Fox Williams’ partner Andrew Hill, who in May filed a case on behalf of institutional investors against online fashion group Boohoo and has previously secured two out-of-court settlements with Tesco over shareholder claims.
In a comment provided to EGR, Hill said the case would offer Entain investors the chance to recover their losses but also shift the landscape of the UK gambling sector.
Hill explained: “This claim will offer institutional investors the opportunity to recover substantial losses but more importantly serve to improve transparency and governance within the UK’s gambling sector, reminding public companies that they need to take their disclosure obligations seriously.
“Hopefully this will therefore have the knock-on effect of improving corporate behaviour, because public companies should know that their shareholders won’t let them get away with misconduct.”
EGR understands that damages from the claims, should they be successful, could be upwards of £150m.
An Entain spokesperson said: “Entain has been made aware that, on 1 August 2024 and 2 August 2024, two groups of shareholders issued separate claims against Entain in the High Court of England and Wales.
“We have not yet been formally served with either of the claims, so these matters are at a very early stage. Entain intends to defend any proceedings robustly.”