A consortium of more than half of Britain’s racecourses did not breach competition laws by forming its own breakaway television channel, a judge ruled today.

In a multimillion-pound case that threatened to split the racing industry, the owners of 30 courses including Cheltenham, Epsom and Newmarket were accused by several of the UK's biggest bookmakers of operating an illegal cartel.

The bookmakers — led by William Hill, Ladbrokes and BetFred — accused the racecourses of colluding to sell exclusive media rights to their own start-up broadcaster, Turf TV, in an attempt to undermine the bookmakers' existing TV channel.

However, the High Court today dismissed the bookmakers’ claim and ruled that the racecourses had not violated competition law.

Mr Justice Morgan said: “It was commercially necessary to enter that market as a successful competitor to take exclusive rights to as many courses as were available.”

Alan Morcombe, chief executive of Turf TV, welcomed the decision: “We are delighted with this outcome, which is a vindication of both the setting-up and operation of Turf TV.

“This case was brought at a critical time in Turf TV’s history and was specifically designed to exclude us from this market and maintain the old monopoly. Now that that attempt has failed, we hope that both Turf TV and those bookmakers involved will get on with developing closer and better relations.”

The dispute arose in April 2007 after 31 racecourses — just over half of the 60 in operation in the UK — joined with Alphameric, a listed London software company, to form Amalgamated Racing (Amrac), which operates Turf TV.

Historically, the rights to broadcast live races to betting shops had belonged exclusively to Satellite Information Services, a distributor part-owned by Ladbrokes and William Hill, the two biggest British bookmakers.

However, the racecourse owners claimed that SIS's grip on the market left them earing too little in royalties from races broadcast from their tracks. Instead, they decided to form their own TV channel.

The bookmakers retalliated in September 2007 with a lawsuit accusing Amrac of breaching competition law.

The bookmakers claimed that the racecourse owners had conspired to raise the prices for images supplied to betting shops, costing them an additional £50 million a year.

But Mr Justice Morgan today ruling that the higher prices merely reflected the increased competition Amrac had introduced to the market.

The judge reserved judgment on a counter-claim brought by Amrac accusing the bookmakers of attempting to shut Turf TV out of the market by boycotting it and withdrawing sponsorship of races at affiliated tracks.

During the case, the former chief executive of William Hill, David Harding, admitted to sending an “inappropriate” and “very silly” e-mail relating to his company’s decision not to sponsor a race at Newbury, one of the Amrac courses.

In an e-mail sent to David Hood, William Hill’s director of racing and PR, Mr Harding said: “They’ve declared themselves to be in direct competition with us, so I see now reason why we should be seeking to help them in any way.”

The eight-week hearing involved six senior barristers and several teams of solicitors and is estimated to have cost around £15 million. It may still go to the Court of Appeal.

William Hill and Ladbrokes both said they were "disappointed" with the judgment and would consult with their lawyers before deciding whether to appeal.

Lawyers who followed the proceedings welcomed today's ruling. Sam Szlezinger, head of the competition practice at Denton Wilde Sapte, the City law firm, said it was "a victory for common sense".

Despite the dispute, all the UK's major bookmakers except BetFred have now signed agreements with Turf TV in order to gain access to races at its 31 tracks. SIS is left with rights to 29 tracks.

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