Reported yesterday (16 February) by the Financial Times, Alexander and Feldman launched the legal action last Thursday (13 February) against both Entain and the law firm that represented the operator in the Turkey case.
What is Kenny Alexander’s argument?
As part of their case, Alexander and Feldman are seeking a court order to see what information was shared with prosecutors during the Turkey case.
As CEO of Entain, under its previous name of GVC Holdings, between 2007 and 2020 Alexander was a key figure in the Turkey case. AG advised Entain during the investigation but also worked with the group in the years leading up to this.
Alexander and Feldman argue they were clients of AG, along with Entain. As such, advice the law firm gave the operator over the Turkish case should be made available to them. They are also seeking information on other legal advice given as part of the case.
“The claimants understand that the company and/or AG may have disclosed, in the course of the investigation and/or in the course of the Deferred Prosecution Agreement (DPA) or otherwise, privileged materials to HMRC, the Crown Prosecution Service[…],” Alexander and Feldman said in the legal claim.
“Where the privilege in those materials was a joint privilege shared by the claimants, the company was not entitled to waive privilege without the consent of the claimants.”
Turkey case background
The Turkey case first came to light in 2019, and related to GVC Holdings’ (Entain’s previous name before rebranding) online betting and gaming business in Turkey. Ropso Malta Limited acquired that operation, Headlong Limited, in 2017.
Media reports at the time suggested the operator continued to benefit from its former Turkey-facing subsidiary in 2019, two years after divesting.
These reports led to His Majesty’s Revenue and Customs (HMRC) launching an investigation into Entain. This widened to cover “potential corporate offending” in 2020, investigating potential offences under Section 7 of the Bribery Act 2010.
Ultimately the operator reached a voluntary Deferred Prosecution Agreement (DPA) with the Crown Prosecution Service (CPS) in November 2023, drawing a line under the dispute. Entain agreed to pay a financial penalty plus disgorgement of profits totalling £585 million, plus a £20 million charitable donation and £10 million in CPS and HMRC costs.
Entain: claim does not hold merit
A spokesperson for Alexander and Feldman, who left Entain in 2020, also gave comment on the case. The pair “extensively relied” on the legal advice given by AG for several years, the spokesperson told the FT.
“They trusted throughout this time that their personal interests were properly protected and have therefore repeatedly sought unfettered access to all of that legal advice, which has so far been denied to them, by both AG and Entain, leaving them with no option but to bring this claim,” they added.
A spokesperson for Entain told iGB: “Entain considers the claim to be without merit and it will contest it robustly.”
Meanwhile AG said in a written statement: “We are unable to comment due to the client confidentiality obligations we are subject to.”
Entain: DPA did not cover former executives
Upon announcing the DPA in 2023, Entain confirmed the deal covered the company and not any of its former executives. This suggested former staff involved with the business at the time could still face charges. The CPS has not yet announced whether it will investigate any of the individuals involved in the case.
Around the time of Alexander’s exit, Entain also shifted its place of management and control from the Isle of Man to the UK.
Failed 888 takeover effort and UKGC lawsuit
Following his departure from Entain, Alexander, along with Feldman and former Entain CFO Stephen Morana, failed in a bid to take charge of 888 Holdings. FS Gaming, an investment vehicle backed by the trio, took a 6.57% stake in 888 Holdings in June. Soon after, a proposal was tabled for Alexander to become CEO, Feldman chair and Morana CFO.
However, this was halted when the Gambling Commission intervened. It said that it has final sign-off for a change of corporate control and directly referenced the Turkey case as a reason for flagging concerns over the proposal.
888 ended talks and ultimately brought in Per Widerström to replace Itai Pazner as CEO after a lengthy search process.
The regulator’s intervention has prompted a separate lawsuit from Alexander and Feldman. They are suing the Gambling Commission over claims it misused their private information during the 888 bid.
The two claim to have “suffered damage, distress and embarrassment, as well as the loss of standing, as a result of the misuse of their private information and/or the breaches of confidence” by the Gambling Commission according to the Racing Post.
More change at Entain as Isaacs exits
Since Alexander stepped down in 2020 Entain has had three chief executives. Shay Segev, his replacement, moved on to sports streamer DAZN after only a few months as CEO. Jette Nygaard-Andersen then took on the top job. She remained in place until December 2023.
Gavin Isaacs then took on the CEO role, only to step down abruptly last week. He had been in the role for five months after assuming the role in September.
Non-executive chair, and previous interim CEO, Stella David, will resume the chief executive position while a permanent replacement for Isaacs is found.
In its statement Entain said Isaacs’ departure was a “mutual” decision and the board was pleased with the company’s performance in 2024.
Original article: https://igamingbusiness.com/legal-compliance/kenny-alexander-suing-entain-turkish-case/
