High Court could block Branson's lottery talks

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The Independent Online

Sir Richard Branson could be blocked by the High Court later today from holding further talks with the National Lottery regulator on taking over the game.

Sir Richard Branson could be blocked by the High Court later today from holding further talks with the National Lottery regulator on taking over the game.

The National Lottery Commission agreed on Friday to suspend talks for three days, after Camelot began legal action over the commission's decision to reject its bid to run the game for another seven years.

Lawyers for Camelot are expected to ask for that voluntary ban, which lapses today, to be extended when they meet Mr Justice Sullivan this morning to get permission to take the decision to judicial review.

Camelot's directors and shareholders, including Cadbury Schweppes, ICL and Racal, were furious when the commission rejected its bid last Wednesday whilst giving Sir Richard an extra month to improve his offer.

The commissioners ruled out Camelot because of doubts that its software supplier, GTech, could be trusted after it covered-up a software error.

If the commission refuses to agree to a voluntary ban, Camelot could apply for an injunction. Its lawyers believe it may take at least two weeks for the judicial review to be heard and a decision made.

A ban of that length threatens to undermine Sir Richard's attempts to meet commission demands within the one-month deadline. He has to find a £50m fund to protect ticket holders money and show The People's Lottery can survive financially if lottery income falls.

A source inside Camelot said: "What we will do is ask the court to consider once again the implications if The People's Lottery and the commissioncontinue to negotiate. We would argue that continuing negotiations between these two parties would prejudice any further discussions with Camelot."

If Camelot presses for the ban, it is expected that the commission will argue it must continue assisting The People's Lottery to ensure the new game is installed in time for 1 October 2001. It claimed on Friday that its talks with Sir Richard would be irrelevant if Camelot's action succeeds.

The People's Lottery refused to comment on the court action, but a spokesman said it had been briefed by the commission on Friday about the required improvements. He confirmed the consortium may need further information to complete its revised bid.

Camelot faces heavy fines for breaching its licence after GTech, a co-founder, concealed a software glitch which had affected roughly 113,000 pay-outs since the game began in November 1994.

The problem was discovered in June 1998 but its then chairman, William O'Connor, covered it up. Camelot and the commission were first told in the spring, after the information was leaked to the commission.

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