Oregon Lottery Needs to Pay Estimated $27 Million to SBTech

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In 1992 Oregon was one of the four states exempted from PASPA. Sports betting continued in this state until 2005 when a new law was passed prohibiting sports betting through the state’s lottery. After the new legislation was passed last year March, Oregon has been hard at work to be able to roll out a platform for retail and mobile operations for sports betting, in time for the 2019 NFL season. This would be done via the Oregon Lottery again.

The Oregon Lottery Commission drafted plans to be able to do this, and they did some surveys to determine the needs of an operator to run this undertaking. Several operators were considered until they decided on using SBTech due to their level of expertise and sports betting platforms they brought to the table.

SBTech

SBTech has offices in both Isle of Man and Malta with five casinos under their wing in the US. These include the Golden Nugget and Resort Atlantic City in New Jersey. Sports betting are their primary focus. Their constant drive towards innovation was a significant benefit in the decision to appoint them, and thus, they became the chosen operator after a unanimous vote.

The Lottery Commission’s executive team gave approval and negotiations between the state lottery, and SBTech took off. The conclusion was that SBTech would be operating sports betting in Oregon under the oversight of the lottery.

The Complaint

This decision led to some controversy when one of the companies in the run for this contract alleged that SBTech Malta is involved in illegal gambling by providing online gambling in areas where it hasn’t been legalized yet. Scientific Gaming laid a formal complaint and requested the disqualification of SBTech due to its operations in Iran and Turkey where it is illegal to partake in sports betting.

They brought their evidence under the attention of the Lottery Commission as well as the Oregon Police. SBTech hit back with a statement confirming that their practices are legal; otherwise, they wouldn’t have been licensed by several jurisdictions. After some investigative work, the Oregon Police declared these allegations as false and gave their approval to SBTech.

The Contract

The details of the contract are not public, but what the Lotter did reveal is that with the agreement in place, the Oregon Lottery will have access immediately to the technology for mobile betting offered by SBTech. Their aim is also to place gaming kiosks at selected restaurants, bars and lottery retailers by 2020.

A forecast has also been released estimating with sports betting beginning in September the revenue that should be created is at $332.8 million for the first year growing towards the third year to a massive $722.3 million. This results in the Oregon Lottery paying SBTech from the revenue earned from sports betting a total of nearly $27 million for the first three year period.