A Sportradar shareholder has filed a lawsuit against the company over its alleged ties to illegal gambling. James Anthony Smale claims to have suffered significant damages due to the company’s stock price crashing recently.
Reports last month claimed that as much as 40% of the company’s revenue may come from illegal operators. The reports were published by Muddy Waters and Callisto Research, both of which admit to holding short positions in Sportradar stock.
In the wake of the reports, the company’s share price fell by around 25%. The lawsuit argues the company and its executives are responsible for the financial blow to shareholders and should pay damages.
Stock Price Starting To Recover
Smale filed the lawsuit on behalf of all individuals who have purchased shares between November 7, 2024, and April 21, 2026. Back in November 2024, the company’s share price was actually relatively similar to its price in April at $17.83 compared to $16.84.
However, it reached a high of $31.63 in August last year. It had already been falling before the recent allegations of dealing with illegal gambling surfaced. On the back of those reports, its price crashed from over $18 to a low of $12.35.
It has slightly recovered over the past few days, rising to $13.12. The stock’s short interest has fallen by 40%, according to MarketBeat. Stephens Investment Management also purchased 2.2 million shares, which has contributed to the price recovery.
Several of Sportradar’s partners, including major sports leagues such as the MLB, NBA, and NHL, hold shares in the company. Muddy Waters urged the leagues to investigate their claims that Sportradar is facilitating illegal gambling.
What Are The Allegations?
The lawsuit will hinge on whether there is truth to the allegations that Sportradar is taking money from unregulated gambling companies.
Muddy Waters claimed that Sportradar “has actively aided and abetted illegal gambling across the world’s black and grey markets – not as an accident or an oversight, but as a business strategy.”
Undercover investigators posed as a startup sportsbook that wanted access to bettors in Vietnam, China, Thailand, and Indonesia, where gambling is illegal. According to Muddy Waters, Sportradar sales staff said they “serve everyone” and offered to introduce the investigators to the Yabo Group, China’s largest illegal gambling operator.
In addition to compiling a 123-slide report, Muddy Waters released a 15-minute video on X, accusing Sportradar of working with illegal gambling companies.
"Sportradar: All-In on the Underworld" Be informed and entertained by MW's mini-doc showing the evidence of how $SRAD knowingly powers illegal operators, preys on addicts, and makes lower levels of sport susceptible to corruption. pic.twitter.com/ORMTjWyxUn
— MuddyWatersResearch (@muddywatersre) April 27, 2026
Callisto Research, meanwhile, says they found evidence suggesting that over 270 platforms (more than a third of the 800 Sportradar claims to serve) are using Sportradar’s products or services while operating illegally in regulated or prohibited gambling markets.
Sportradar Denies Allegations
The lawsuit frequently cites instances in which Sportradar executives have claimed the company does not operate in gray or illegal markets.
In November last year, CEO Carsten Koerl assured investors that it “only work[s] with licensed operators”. Koerl also said the company has an “internal audit” process to identify areas where Sportradar’s “content is popping up in markets which are not licensed, which are not covered by the contracts”. He said that this only “happens for a handful of cases every year” and emphasized that “we are monitoring this very closely.”
The company reasserted that it does not work with unlicensed operators following the Muddy Waters and Callisto Research reports.
“These reports demonstrate a fundamental misunderstanding of our business and the industry and was authored by short sellers trying to erode shareholder value and profit from stock disruption,” said a company statement.
“Sportradar works exclusively with licensed operators, follows strict global compliance, and due diligence standards, and we stand by our independently audited financial statements, risk disclosures, and information provided to investors and regulators.”
“We conduct our business with the highest ethical standards consistent with Sportradar’s policies and applicable laws and regulations.”
It may have to prove that is true in court. The lawsuit was filed in the United States District Court for the Southern District of New York and demands a jury trial.
