Victorian Court dismisses Tabcorp appeal, rules in favor of Tatts

The Victorian Court of Appeal has handed down its verdicts related to compensation payments over the loss of a pokie duopoly in the state, rejecting a claim by Tabcorp but ruling that the government should pay Tatts $540 million ($453 million) plus costs.
The appeal court verdicts mirrored earlier judgements handed down by the state’s Supreme Court.
Tatts welcomed the decision, but said the amount would not be reflected in its financial results until the matter is finally resolved, given the state still has 28 days to decide whether to appeal to Australia’s High Court.
Tatts argued that the state had agreed in 1995 to a provision providing significantly higher license fees from its pokies business in return for a clause that compensation would be paid should the market be opened to other players.
Tabcorp had sought $686 million in compensation, though its claims have been rejected by the courts.
The company said it is currently considering whether or not to appeal to the federal High Court.
However, Tabcorp has already taken charges in its financial results over the rulings and Thursday’s verdict will have no further impact on its accounts. The company had a one-off charge of $461 million in 2008 earnings, and a further $18 million in non-cash amortization charges related to the Victorian Gaming License and $9 million related to the Victorian Wagering License to August 2012.