Media Mogul Richard Desmond Seeks $1.58B in Damages from UKGC

Lawyers representing Richard Desmond’s Northern & Shell investment firm and his lottery bid vehicle, the New Lottery Company (TNLC), argue that the Gambling Commission committed “manifest errors” during the complex and opaque competition process for Britain’s largest public sector contractImage Source: Shutterstock.com

Billionaire media mogul Richard Desmondhas called on a court to lean on the side of “generosity” in evaluating a GBP 1.3 billion (approximately $1.58 billion) damages claim against the United Kingdom’s Gambling Commission (UKGC).This is a sum that would likely be covered by taxpayers if he prevails in the legal battle.

Richard Desmond Seeks GBP 1.3 Billion in Damages from the UKGC

Lawyers representing Richard Desmond’s Northern & Shell investment firmand his lottery bid vehicle, the New Lottery Company (TNLC),argue that the Gambling Commission committed “manifest errors” during the complex and opaque competition process for Britain’s largest public sector contract. The 10-year licence was awarded in 2022 to Allwyn, a newly formed company ultimately owned by Czech billionaire Karel Komárek, which has operated the National Lottery since 2024.

If successful, the payout could have a major financial impact on both charities and taxpayers, as the compensation would come from a lottery fund designated to support good causes. If the award exceeds the available funds, which are believed to receive around GBP 30 million (approximately $36.4 million)per week from lottery ticket sales, the shortfall would likely be covered by taxpayers.

TNLC alleges that the Gambling Commission gave feedback to rival bidder Allwyn at a stage in the process when it should not have, calling this a “very serious breach” of the competition’s rules. 

Speaking of Allwyn, it is also participating in the case, effectively aligning itself with the Gambling Commission. The company has a vested interest in defending the outcome of the bidding process, as its reputation could be damaged if Desmond’s legal team succeeds in persuading the judge that Allwyn should not have been awarded the license.

While the UKGC sought a settlement with Desmond’s Northern & Shell PLC, the issue continued, and a bitter case opened this week. At the High Court, Desmond’s legal team told Mrs Justice Smiththat the bidding process was fundamentally flawed on multiple grounds, and argued that the competition should have been rerun after the terms of the contract were changed post-award.

UKHC Responds

The Gambling Commission has defended its handling of the licensing process, describing it as robust and thorough. In legal submissions, the regulator argued that Desmond’s bid was “fanciful” and performed “extremely badly” in what it called a rigorous competition.

Sarah Hannaford KC, representing the commission, dismissed Desmond’s claim, seeking damages for potential earnings TNLC might have made if the process were rerun as “hopeless.” She told the court it was “extremely unusual, if not unique, for a bidder who lost so spectacularly to argue that it should have won,” adding that TNLC’s belief it could have succeeded with more detailed early feedback was merely “wishful thinking.”