Bill,
I have to disagree with you here.
There needs to be some sort of common-sense standard when grading these things and it would have been a mistake if they graded Cleveland to be the winner.
I say this even though I would have made about $2,500 more if WSEX graded Cleveland to be the winner.
The only person who deserves some sort of compensation is the guy who called into WSEX asking specifically about the sign and trade and was told Cleveland would be the winner. He deserves to have 100% of his losses refunded to him by WSEX assuming there is some sort of record of his phone call (they normally record most phone conversations).
Everyone who bet on this thing knew they were betting on which team Lebron will play with next season.
2 totally independent companies (Intrade and WSEX) who worded the bet "who will Lebron James sign with" saw it the same way. Technically, Lebron James is going to sign with Miami and there wasn't any mention on who will Lebron James sign with FIRST.