Playtech Unmasked as Sponsor of Defamatory Evolution Report

The report falsely accused Evolution of offering games in markets under sanctions and to unlicensed operators. Evolution claims the action was anti-competitive and sought to damage its business, causing billions of dollars in losses.

Competitive Tactics and Investigation

Playtech commissioned the report in late 2020. They paid Black Cube over $\text{GBP }1.8$ million to produce the document. The report claimed Evolution supplied services to prohibited and unregulated gambling markets. Black Cube, founded by former Israeli intelligence operatives, reportedly used deceptive tactics.

These methods included using fake names, wearing disguises, and secretly recording conversations with Evolution staff. These edited recordings were allegedly compiled to support a false narrative.

The report was then sent to US regulators, including the New Jersey Division of Gaming Enforcement (NJDGE) and the Pennsylvania Gaming Control Board (PGCB). It was also leaked to news outlets.

Playtech defends its choice to order the report. A company spokesperson stated they acted to check “serious questions” about Evolution’s market practices. Playtech claims the investigation aimed to verify concerns of regulatory importance.

Regulatory and Market Response

The financial fallout was swift for both companies. Playtech shares fell as much as 39% after its role was revealed. This drop erased over $\text{GBP }400$ million ($\$535$ million) from the company’s market value. Evolution’s stock saw an initial increase before stabilizing. The company stated the report caused multi-billion dollar damage.

Both US regulators that received the report later cleared Evolution of wrongdoing. The NJDGE and PGCB closed their investigations in February 2024.

The NJDGE stated they found “no evidence” Evolution took illegal bets from New Jersey or other banned areas. Separately, the New Jersey Superior Court ruled the Black Cube report was untrue. The court found it lacked factual support and was “objectively baseless.”

Ongoing Legal Battle

Evolution filed a defamation lawsuit in 2021 against the law firm that submitted the report and the unnamed client. Following the disclosure of Playtech’s identity, Evolution plans to add Playtech as a defendant in the case.

Evolution’s leadership stated it was “deeply disturbing” that a competitor went to such lengths to damage its reputation. They will hold Playtech and Black Cube responsible for the harm caused. Black Cube continues to defend its findings, citing a body of evidence that supports its claims.

However, Evolution expects the court proceedings to continue through 2026. Industry analysts criticized Playtech’s move as a “mistake” that harms the entire gaming sector, raising concerns about corporate governance.