Lottery Firms Fail to Resolve Printing Dispute
The lottery’s suppliers returned to court without resolving where California tickets will be printed, disappointing state officials.
Dittler Brothers Inc. of Atlanta, Ga., the subcontractor that prints tickets for Scientific Games Inc. of Norcross, Ga., also fired another volley in the publicity war between the firms.
Dittler claimed Scientific Games owes the lottery more than $800,000. Scientific Games saved the money by requiring smaller tickets than were specified by the state, according to Dittler.
Scientific Games and the lottery disputed the claim, saying the tickets met specifications.
In a Georgia court Monday, Scientific Games asked an auditor-arbitrator to end the company’s exclusive contract with Dittler and instead let Scientific Games use its own Gilroy, Calif., plant to print the scratch-off tickets.
Lottery officials on June 12 ordered Scientific Games to immediately fire Dittler Brothers and make new printing arrangements or lose the job of printing another $32 million in tickets.
The action came after a court-appointed arbitrator ruled that Dittler had overcharged Scientific Games for materials, behavior that lottery officials said conflicts with the spirit of the voter-approved 1984 lottery initiative.
Dittler denies committing fraud and says it hopes to reverse the order against its printing of California tickets.
Auditor-arbitrator Ralph Levy heard testimony during a lengthy hearing, took the matter under consideration and indicated that he hoped to issue a ruling by today on where tickets will be printed, according to attorneys.
Lottery Director Mark Michalko said last week that he hoped to await the outcome of the hearing but would dump Scientific Games and seek bids on a new contract if the issue went unresolved the rest of this week.
“He (Michalko) has no intention of allowing this thing to drag on,” lottery spokesman Bob Taylor said.
“He intends to act on this matter this week. Time is of the essence when it comes to the possibility of going out for a new contract” to avoid running out of tickets, Taylor said.
The Assembly and Senate Governmental Organization committees, meanwhile, held a joint session Tuesday on the lottery to assess the status of major contracts, participation of minorities and women in contracts, ads for contracts, revenues and expenditures and the number of winners and odds of winning prizes by category, plus future developments and proposals.