A lot of clients and people referred to us by clients call us because they feel they have been harmed by a breach of some kind of contract. Most of them have indeed experienced a breach, usually fairly overt. After all, contracts are violated every day in a thousand different ways in the U.S.. You may be in breach yourself as you read this, perhaps by violating your Apple or Google or Gmail terms of service – you know, the agreement (contract) you signed without reading. Because who does?
The question isn’t so much if there is a breach but do you have a legitimate case? And . . . can you collect damages.
Here are three scenarios where breaches (probably) occurred but the results are very different.
Fat Fingers
Gambling on sports is big business – in-person, on-line, billions are bet every month. You can bet on anything on, sports books still employ humans to set some odds but are increasingly reliant on algorithms and computer programs operating in real time during games to set odds.
Mistakes are made. Recently, a major sports book, using a ‘human operator’ set the over-under of an NFL game at 500. For the non-NFL, non-gamblers among us, that means that you could place a bet that the combined points of the teams playing would be less than 500.
The most combined points ever scored in an NFL game is 116. Five hundred is insane, it could never happen.
But people took the bet. Knowing it wasn’t possible to come close. Knowing they took the surest thing in the history of sports betting.
IN short, they knew it was a mistake. The sports book did not honor the bets, they pointed to a clause in their contract that allowed for voiding a bet because of a ‘fat finger error.’
‘Fat finger error’ might be the best, most perfectly descriptive phrase ever – it means that someone typed in the wrong numbers. The true over-under was 50. Obviously. People threatened to sue but, c’mon.
Obvious Errors that Aren’t Obvious
The ‘fat finger error’ is in every sports betting contract – somewhere. And it makes sense for everybody. Simple, nothing to see here, no grounds to sue and demand payment.
There is a problem, however: “Too many sportsbooks are using the “obvious error” rule as a “get out of jail free” card, letting them clean up on props and parlays against casual bettors while voiding big winners “repeatedly, indefinitely,” instead of being required to take down flawed products and address their weaknesses.”
That was Ed Miller, a former odds maker, quoted in the Washington Post, in a story about Christopher Kozak, a derivatives trader and experienced sports gambler. “Last November, on a trip to Nashville, he placed 10 NHL same-game parlays through Hard Rock’s sportsbook and won three of them. In one $300 wager, he bet that eight players wouldn’t score in a game between the Anaheim Ducks and Florida Panthers, and that Anaheim would score fewer than three goals.”
He won $127,420 . . . except Hard Rock refused to pay it. The sportsbook notified him several days after the games that his payouts were an “obvious error,” and he wasn’t owed anything beyond a refund.
When Kozak unsurprisingly pushed back, Hard Rock tried to renegotiate the odds — week after the games were played. The company refused to explain the nature of the “error” or what made it “obvious.”
This, of course, is very different from our ‘cases’ above. There’s a clear breach of contract and there is certainly very real damage.
The kind of case we would advise a client to pursue. Kozak, by the way, doesn’t have to court, after the Washington Post started asking Hard Rock for it’s records, it paid the winnings in full.