Investors Sue Sportradar After Shares Fell From $16.84 to $3.80 on Black-Market Gambling Claims
Updated
Updated · Courthouse News Service · May 19
Investors Sue Sportradar After Shares Fell From $16.84 to $3.80 on Black-Market Gambling Claims
2 articles · Updated · Courthouse News Service · May 19
A securities class action filed Monday in Manhattan says Sportradar misled investors about compliance and ethics, leaving them to buy shares at artificially inflated prices.
The suit centers on April 22 reports by Muddy Waters and Callisto alleging the company used black-market gambling partners to generate a material share of revenue despite claiming it worked only with licensed operators.
Sportradar’s Class A shares dropped to $3.80 from $16.84 after the reports, according to the complaint, which says the selloff exposed the gap between public assurances and actual due-diligence practices.
Callisto said more than 270 of roughly 800 platforms tied to Sportradar were operating illegal markets or claiming to use its services, and identified 1xBet as a top-10 client likely to be the largest illegal operator by revenue.
The case targets a company that supplies betting data and fraud-monitoring services to leagues including the NBA, MLB, NHL, PGA Tour and FIFA; Sportradar declined to comment.
Was Sportradar the betting industry's 'FBI' or a key partner to its largest black market operators?
With its data partner accused of fueling illegal gambling, can leagues like the NBA and FIFA still guarantee sports integrity?
Sportradar Faces $3.8 Billion Stock Plunge Amid Lawsuits and Illegal Gambling Allegations: Industry and Investor Fallout
Overview
The crisis at Sportradar Group AG began when investors who bought its securities suffered financial losses as the company’s stock value dropped sharply, leading to substantial shareholder setbacks. This market instability prompted investors to learn about their legal rights and resulted in a formal securities class action lawsuit against Sportradar. Despite the company’s public claims of high ethical standards and a strict process to work only with licensed operators, the lawsuit alleges that Sportradar’s actual business practices contradicted these statements. This disconnect between public commitments and alleged actions triggered significant legal and financial turmoil for the company.