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The Court's Yellow Card for the United States Soccer Federation: A Case for Implied Antitrust Immunity

Daniel J. Gandert, Northwestern University

Abstract

In the case Championsworld v. USSF, the USSF’s power over all soccer in the United States was challenged. Between the years of 2001 and 2005, Championsworld was one of the main soccer promoters in the United States. The United States Soccer Federation (“USSF”) required that Championsworld pay the organization a sanctioning fee, which the company believed to be excessive and partially responsible for the company’s bankruptcy. This resulted in the company’s creditors suing the USSF for antitrust violations in U.S. District Court. The court hearing Championsworld should have determined that the Amateur Sports Act provided the USSF with implied antitrust immunity.

In 1978, the Amateur Sports Act was passed in response to poor performance by U.S. Olympic teams. This act was updated in 1998 as the Ted Stevens Olympic and Amateur Sports Act (ASA), as the distinction between amateur and professional sports started to become blurred in many areas. Both versions of the act established that every Olympic sport is to be governed by a National Governing Body (“NGB”). Under this act, USSF has the authority to govern all aspects of amateur soccer for the United States since it is the NGB for soccer. In order to participate in Olympic soccer, the USSF is required to be a member of Internationale de Football Associationas (FIFA), the international federation governing both professional and amateur soccer worldwide. FIFA requires for its member associations to exercise authority over all professional leagues in their country, in addition to exercising jurisdiction over amateur matches. This includes the requirement that member associations sanction professional matches. The USSF is a member association of FIFA, and as such, is required to follow all FIFA regulations. Strictly following antitrust laws would put the USSF out of compliance with FIFA, which could hurt the U.S. Olympic and other international teams in soccer. Therefore, USSF should have an implied antitrust exemption under the ASA.

In order to find implied immunity for a statute or regulatory scheme, a court must find that applying the antitrust laws to that regulatory scheme would be repugnant to the intended effect of that regulatory scheme. The ASA sets up such a scheme which would be repugnant to antitrust enforcement. The act requires every NGB to set national goals for its sport, to coordinate its scheduling in a way that minimizes scheduling conflicts, and to work to develop national interest in its sport. Additionally, it sets up a system of appeal for decisions or actions taken by an NGB to ensure the fairness and reasonableness of its actions. Because of this, the court hearing Championsworld’s case should have determined that the ASA provided the USSF with implied antitrust immunity and should have required their claims to be heard through the appellate system set-up by the ASA.

Suggested Citation

Daniel J. Gandert. 2011. "The Court's Yellow Card for the United States Soccer Federation: A Case for Implied Antitrust Immunity" ExpressO
Available at: http://works.bepress.com/daniel_gandert/1

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