As part of Seyfarth’s 2026 Trade Secrets Webinar Series, our panel presented Protecting the House: Trade Secret Risks in Online Gaming, Sportsbooks & Predictive Markets, examining how the rapid expansion of digital wagering platforms is reshaping trade secret risk, regulatory exposure, and competitive strategy.
Michael Wexler, Mitch Robinson, and Bessie Fakhri led a practical discussion for in-house counsel, compliance professionals, product leaders, and executives operating in online gaming, sports betting, and predictive markets. The session explored how proprietary algorithms, AI-driven models, and consumer data are becoming central assets—and central risks—in an increasingly competitive and scrutinized industry.
View the Recording – CLE credit for this recording expires on March 31, 2027. See description for jurisdictions and details.
Key Takeaways
Predictive Markets Introduce New Trade Secret Exposure
The rise of predictive markets is creating new incentive structures that may increase the risk of misuse or leakage of confidential information. Where outcomes are tied to data inputs, modeling assumptions, or internal insights, companies must carefully assess how access to sensitive information could be leveraged—intentionally or unintentionally—in ways that compromise trade secrets.
Routine Auditing Is a Core Safeguard
Online gaming platforms and sportsbooks are increasingly implementing routine audits of systems that handle proprietary and trade secret information. These audits are critical to maintaining defensibility under trade secret law, helping organizations:
- Identify access vulnerabilities
- Monitor data flows across systems
- Demonstrate “reasonable measures” to protect confidential information
Regular, documented auditing practices are becoming a baseline expectation in this space.
AI Expands Both Capability and Risk
The growing incorporation of AI across online gaming, sportsbooks, and predictive markets raises important considerations around trade secret protection and user privacy. Key risks include:
- Exposure of proprietary data used in model training
- Unclear ownership of AI-generated outputs
- Increased scrutiny of how algorithms operate and use sensitive data
Organizations must implement clear governance around AI systems, including data controls, usage policies, and documentation.
Regulation Will Shape the Industry’s Future
Regulatory frameworks at both the federal and state levels continue to evolve and will play a significant role in shaping the future of online gaming, sportsbooks, and predictive markets. Increased scrutiny around data use, consumer protection, and platform integrity will directly impact how companies:
- Define and protect trade secrets
- Structure their platforms and offerings
- Respond to compliance and disclosure obligations
Staying ahead of regulatory developments will be critical to maintaining both compliance and competitive advantage.
Looking Ahead
As online gaming, sportsbooks, and predictive markets continue to expand and converge, trade secrets will remain central to competitive positioning. Companies that proactively audit their systems, implement strong AI governance, and adapt to evolving regulatory expectations will be better positioned to protect sensitive information while navigating an increasingly complex legal landscape.
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