Sportsbet files counterclaim in fast code class action, court date set for August

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The Backstory

From “fast codes” dispute to a broader stress test

Sportsbet’s counterclaim lands in a case that has grown from a technical fight over “fast codes” into a referendum on how Australia enforces in-play wagering rules and treats consumer redress at scale. Plaintiffs allege the company used alphanumeric codes to enable live bets online, sidestepping the Interactive Gambling Act’s telephone-only requirement for in-play wagering. Sportsbet denies wrongdoing and argues that, if courts find the practice unlawful, customers who won using the codes should return those winnings. The stakes now extend beyond one operator’s liability to questions about how courts balance remediation for losses against clawbacks of gains in a mass claim.

The legal question is straightforward; the implications are not. A court finding that online in-play bets were facilitated improperly could open Sportsbet to significant refunds on losing wagers, while a successful counterclaim could force part of the class to surrender past winnings. That dual exposure is unusual in consumer litigation and reflects the way in-play betting touches both compliance and consumer outcomes. The August trial date will put those issues to the test and determine whether the remedy is unilateral refunds, netting wins and losses, or something in between.

Opt-out order swells the case — and the risk

The Victorian Supreme Court’s move to automatically include affected customers unless they opt out reshaped the case’s trajectory. By ordering Sportsbet to notify users and enroll them by default, the court all but guaranteed the group would expand well beyond the original filer. Reporting on the ruling detailed how the opt-out framework could “significantly” increase the class, with no out-of-pocket costs for participants and a contingency fee for class counsel, raising both the potential liability and the procedural complexity for the defense. Sportsbet began contacting customers after the order, which set a Feb. 13 deadline to opt out. The case, filed in 2024 and led initially by plaintiff Jeremy Bergman, seeks refunds on all live bets placed with the codes since 2018. Sportsbet has continued to deny the allegations and to emphasize that, if plaintiffs prevail, players who profited from the codes could be asked to repay those winnings — a position that foreshadowed the counterclaim now on the table. Read more about the court’s ruling and the possible enlargement of the class in this coverage of the opt-out decision and its expected impact.

The breadth of potential claimants heightens the chance that the proceeding becomes a de facto audit of industry practices around in-play betting mechanisms. It also raises practical questions: how to validate which wagers were placed via fast codes, how to quantify eligible refunds, and whether any model for netting wins and losses can be administered at scale without extensive disputes.

A parallel front: responsible gambling failures under the microscope

The fast codes litigation is not the only courtroom pressure point for Sportsbet and its peers. In a separate federal case, Sportsbet, Tabcorp and Entain were accused of accepting millions in stolen funds from a former financial planner and failing to follow mandatory responsible gambling rules. The lawsuit alleges operators ignored red flags while extending inducements and VIP attention as losses mounted, and it names two former VIP managers for allegedly encouraging continued play. Regulators have previously reprimanded BetEasy, now part of Sportsbet, and fined Ladbrokes, part of Entain, over the same gambler’s activity, putting longstanding VIP practices under sharper scrutiny. Legal analysts say the case could set precedent that expands operator liability for lapses in harm-minimization controls. For detail on those allegations and the regulatory context, see the report on the responsible gambling lawsuit targeting VIP programs and oversight.

Taken together, the fast codes and responsible gambling suits bracket the industry from both ends: product compliance on one side and duty-of-care obligations on the other. Any adverse findings, even if limited to certain fact patterns, could drive tighter internal surveillance, more conservative VIP engagement and more explicit remediation frameworks for problem gambling and prohibited bet types.

Ad backlash adds political heat to compliance questions

Public and political sentiment is tilting toward tighter guardrails, adding reputational risk to the legal exposure. Sportsbet faced criticism for promoting expanded same-game multi bets on the Australian Football League’s website months after pulling similar ads from free-to-air TV. While the online placements did not violate current rules, they fueled calls from lawmakers and reform advocates for comprehensive advertising restrictions and cast doubt on the industry’s capacity to self-regulate. The government has signaled plans to toughen ad rules, and prior proposals for a total ban have reemerged in debate. The episode underscores how even technically compliant marketing can become a flashpoint when enforcement posture and public tolerance are shifting. For more, see the scrutiny over Sportsbet’s AFL multi-bet promotions and the push for ad reform.

That climate matters in court. Judges mindful of broader harm arguments and public policy concerns may give less leeway to gray-area tactics, while companies face a tighter margin for error. The optics of pushing aggressive bet types or VIP inducements can influence settlement dynamics and regulatory follow-ons even if specific ad buys meet the letter of existing rules.

Margins squeezed, offshore rivals rise — and the compliance trade-offs

Industry economics are also pressing on strategy. Sportsbet chief executive Barni Evans has warned that rising product fees and higher point-of-consumption taxes have lifted the share of revenues going to levies to roughly half, forcing operators to trim promotions and hike overrounds. He says licensed brands have cut advertising spend sharply, ceding visibility to offshore operators that face fewer constraints. He estimated illegal offshore sites now account for about 15% of Australia’s online betting market and are growing fast — a trend he argues risks undermining licensed firms’ ability to fund sports and racing while meeting compliance costs. See his remarks on offshore growth, tax drag and shrinking ad budgets.

This line of argument will likely feature implicitly as the fast codes case proceeds: operators contend that stringent rules and mounting costs push players to unregulated sites that do not honor local protections. Plaintiffs and reformers counter that guardrails are necessary to prevent harmful or unlawful betting, and that compliance shortfalls by market leaders cannot be excused by offshore competition. The court’s handling of remedies — particularly any repayment of winnings — will signal how far the legal system is prepared to go in deterring workarounds while maintaining a coherent path for consumer restitution.

Why the August trial matters

The August hearing is poised to do more than resolve a dispute over a code. It will clarify whether courts treat in-play violations as a strict liability consumer harm warranting refunds, or as a two-way accounting that returns both losses and gains to the status quo. It will also test how scalable those remedies are in a class spanning years of betting activity and potentially hundreds of thousands of people. A ruling that favors plaintiffs without netting would impose a significant financial hit and likely trigger sweeping compliance reviews. A decision that embraces clawbacks could dampen class participation and reshape claimant strategies in future suits.

Beyond Sportsbet, the outcome could inform how regulators and operators calibrate product design, customer verification, VIP oversight and marketing in a market under fiscal pressure and political scrutiny. With parallel litigation over responsible gambling and heightened backlash to advertising, the court’s guidance will help set the contours of what is considered acceptable conduct — and what carries legal and financial consequences — in Australia’s crowded wagering landscape.