Primer: What NASL's suit against U.S. Soccer is all about

Less than three weeks after U.S. Soccer's board of directors voted to not sanction it as a Division 2 league for 2018, the North American Soccer League filed a Federal antitrust lawsuit against the federation in Brooklyn. For a look at the case, what has happened to the NASL to get to this point and the complicated history of soccer litigation.

NASL vs. USSF: Complaint

What the NASL wants:

-- A preliminary injunction to maintain the status quo, keeping U.S. Soccer from stripping it of its Division 2 sanctioning as it moves forward into 2018.

-- A permanent injunction to eliminate U.S. Soccer's divisional structure, allowing leagues to operate without designations and without the Division 1 classification that, the NASL argues, gives MLS an advantage.

What the NASL alleges:

-- U.S. Soccer has divided men's pro soccer based on arbitrary criteria that it has manipulated to favor MLS, which is a commercial business partner via SUM, which sells and markets MLS rights combined with rights to U.S. national teams.

-- U.S. Soccer has selectively applied and waived its divisional criteria to suppress competition from the NASL, both against MLS and against the USL.

-- U.S. Soccer has sought to limit competition from the NASL to MLS and USL and now seeks to destroy the NASL by arbitrarily revoking the NASL's Division 2 status for the 2018 season.

NASL's recent troubles:

The NASL was launched in 2011 after U.S. Soccer brokered a settlement between feuding USL league and club owners. The more ambitious club owners formed the Division 2 NASL and the USL retrenched as a Division 3 league.

-- Underlying problems in ownership structure remained as Traffic USA operated or funded half of the eight original NASL teams (much like AEG did in the first decade of MLS).

-- Traffic USA involvement became toxic when the FIFA corruption case broke in May 2015. Indictments were returned and arrests made in connection with a massive criminal enterprise at the center of which was Traffic. The NASL had nothing to do with the criminal enterprise involving the sale of marketing rights in Concacaf and Conmebol, but Aaron Davidson, the former NASL chairman, was indicted and later pleaded guilty.

-- The NASL was on life support by the end of 2016 when it dropped from 12 teams to eight as Minnesota United joined MLS, Ottawa and Tampa Bay bolted to the USL, Fort Lauderdale and Rayo OKC folded, and the New York Cosmos' ownership pulled out.

The NASL was saved when cable entrepreneur and former Columbia University soccer star Rocco Commisso bought the Cosmos and U.S. Soccer granted the NASL provisional sanctioning for 2018.

Soccer and antitrust law:

Soccer is unique among American pro sports because of U.S. Soccer and its authority over American soccer derived from FIFA. Since the advent of pro soccer in 1967, there has been a steady stream of legal challenges to U.S. Soccer's authority.

-- The outlaw NPSL sued the rival USA (fronted by foreign clubs for the summer), the USSFA (as U.S. Soccer was then called) and FIFA on antitrust grounds at the end of the first season. Before the case was decided, the two leagues merged -- there was hardly interest for one soccer league, let alone two -- and the NASL was formed, providing amnesty to players who had played in the NPSL without FIFA's approval.

-- The USSF "won" both antitrust cases in modern era: Fraser vs. NASL and Champions World vs. USSF. But both were won on technicalities, leaving the key issue of the federation's authority to oversee pro soccer unsettled.

In Fraser, in which the USSF was a defendant, players attacked MLS's single-entity structure and U.S. Soccer's Division 1 designation, but the case collapsed before the validity of MLS's single-entity structure could be determined. MLS could not conspire to control a market because the market for players was greater than MLS alone.

In Champions World, which went bankrupt after promoting international matches, Charlie Stillitano, the firm's promoter had agreed to FIFA arbitration as a FIFA match agent, taking the case out of the court's hands.

h/t: Steve Holroyd

NASL's attorney:

Tuesday's filing came as no surprise to NASL watchers. In 2015, the NASL was seeking Division 1 sanctioning and threatened to sue the USSF on grounds that it proposed to change the Division 1 requirements -- move the goalposts, so to speak -- related to league size and ownership wealth, among other things. (The pleadings in Tuesday's filing covered the 2015 dispute in great detail.)

The NASL's attorney then and now is Jeffrey Kessler. The longtime labor and anti-establishment attorney, perhaps best known for his suit against the NCAA, represented the MLS Players Association in Fraser and represents the Women's National Team Players Association against U.S. Soccer in its EEOC complaint.

Kessler was once on the other side in a fourth soccer case that provides a reality check for NASL owners and what may lie ahead in their suit against U.S. Soccer. Kessler has made a career of challenging the National Football League, and he represented the old NASL when it sued the NFL to strike down its ban on NFL owners owning teams in other pro sports leagues.

The NASL won on appeal in 1982 in a case that went all way to the Supreme Court, but by the time punitive damages were awarded -- all of $1 -- the NASL was on the verge of collapse. In the case of the current NASL, the great fear will be that clubs won't survive long enough to gain the benefits of any decision on the merits of its case.

NASL's Pro/rel case:

A side note to the NASL's case is the pro/rel claim filed by the NASL's Miami FC and amateur Kingston Stockade FC of the NPSL against U.S. Soccer, Concacaf and FIFA in the Court of Arbitration for Sport, seeking to require U.S. Soccer to adopt promotion and relegation across all U.S. Soccer divisions. The NASL wants all U.S. Soccer divisions abolished.

If the NASL prevails in its antitrust suit, there will be no U.S. Soccer divisions to implement pro/rel. There would be nothing, however, to prevent the NASL or any other private league from launching a multi-tiered league with its own pro/rel component.

FIFA's position:

The X factor in NASL vs. USSF is FIFA's position. The one thing you should know about FIFA is that it has historically abhorred the court system -- and that was true long before the 2015 FIFA corruption case turned FIFA upside down.

It's been suggested that the filing of the suit will threaten U.S. Soccer's World Cup 2026 bid with Canada and Mexico. But Champions World was making its way through the courts in 2010 when U.S. Soccer was bidding for the 2022 World Cup. It lost out to Qatar, but that had nothing to do with FIFA's position on the litigation.

8 comments about "Primer: What NASL's suit against U.S. Soccer is all about".
  1. Fire Paul Gardner Now, September 20, 2017 at 10:28 a.m.

    This is really about a bunch of self-absorbed narcissists who want to piggyback off the hard and initially unprofitable work MLS and US Soccer did to grow the game in this country. They couldn't care less about how this impacts soccer here. They only care about getting their way. Fortunately this clown league will likely be out of business before they can do any real damage.

  2. Rusty Shackleford replied, September 20, 2017 at 12:12 p.m.

    I understand why the USSF sets these rules, but I think that they've served their purpose and are ready for reform.

    These seemingly arbitrary rules not only hurt leagues like the NASL, but successful lower-league clubs who can't find a billionaire benefactor, but who otherwise check all the boxes.

    I appreciate what MLS has done to grow the game in this country over the last 25 years, but I think we're beyond the need for the USSF to put its thumb on the scale to support one league or set of clubs over others in the name of stabilizing the game.

    It's time to let clubs (and by extension, leagues) compete. If we're truly committed to taking this game to the next phase in this country, we need to let different ideas compete.

    Please don't misunderstand this as a pro/rel argument. I'm not a member of the Church of Ted.

  3. Fire Paul Gardner Now replied, September 20, 2017 at 7:19 p.m.

    Ok but you can name another country where there are multiple leagues competing? How does having a hodgepodge of different leagues all claiming to be "division one" help soccer in this country?

  4. :: SilverRey ::, September 20, 2017 at 10:51 a.m.

    For a league that started out hell-bent on bringing pro/rel to US leagues, the seem very disinterested in plying their trade within a merit-based system.

  5. Bob Ashpole, September 20, 2017 at 11:46 a.m.

    Thanks for the article and link to the complaint. I don't think much of the cause of action. Plaintiff has not claimed damages and is probably looking for court-ordered arbitration under the eastern district's local rules. As a supporter of the sport, I am not sympathetic with NASL.

  6. Bob Ashpole, September 20, 2017 at 11:52 a.m.

    I disagree with the characterization. This is about a desperate, failing business trying to survive through litigation. How is NASL going to handle the fact that clubs have moved between leagues in the past. How is NASL going to handle famous players playing for lower division teams? The players are usually older, but that would seem to coincidental to the cost of the top players, which is the market place at work.

  7. Scott Johnson, September 20, 2017 at 12:16 p.m.

    The lawsuit appears to be BS. But FIFA, like the IOC, considers itself to be a law unto itself; and tends to believe that it--and not national governments--is the ultimate governing body when it comes to matters of soccer. Some timely reminders to FIFA that it is just a private organization subject to the laws like anyone else are perhaps due. (And the suggestion that FIFA would punish US Soccer for a lawsuit in which US Soccer is the defendant--other then perhaps as a vain hope to threaten the US political system into quashing this case, which it won't--is absurd.)

  8. Nick Daverese, September 20, 2017 at 12:32 p.m.

    When in doubt sue in Brooklyn. They have good street venders down there :) lawyers we love them I do I have been married to one for over 50 yrs. I remember I had to appear in court there years ago. They had people all over the place wanting people to sign a petition to end the death penalty. They asked me I said sure do you want to know why I want to sign it. They did not care but I told them any way. For a second after I told them I thought they would all leave, but they stayed. I can't tell you what I told them.

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