A complete fact/reality check of the NASL lawsuit (abridged)

Apologies to Reduced Shakespeare Company for the headline.

let-it-rot

“In the midst of all this public bickering, Let It Rot was released as a film, an album, and a lawsuit.”

I went line-by-line through the NASL lawsuit and was intending to come back to anything that has yet to be covered in the Pro League Standards (story with PDF / standards sans PDF). After 3,000 words, I realized I was repeating myself. Or nit-picking. (In paragraph 16, the suit refers to “USFF,” and I quipped that this had nothing to do with U.S. Futsal.)

Let’s just hit the generalities:

This is a direct challenge of U.S. Soccer’s power to regulate pro soccer.

Paragraph 4: “The USSF is a private organization and has no legal authority to confer immunity from competition to anyone.”

This is where we’ll find some of the interesting questions. Around the world, of course, the national federation governs the game in that nation, and that’s not disputed. You could argue that the FA has unfairly promoted the Premier League at the expense of other leagues, and I wonder if any lawyers in England have ever considered challenging the EPL’s money-making machine as a repression of “sporting merit.”

In the USA, the legal authority for U.S. Soccer comes from the Stevens Act, which poses some problems …

And, both implicitly and explicitly, the suit challenges FIFA.

Paragraph 57: “FIFA is a private international body that has assumed the role of organizing men’s and women’s soccer on a global basis. Its rules and regulations are privately derived and formulated, and do not have any governmental source of authority over professional soccer in the U.S.”

That’s a necessary challenge because FIFA expects the national federation to govern soccer in its country. In fact, it demanded that U.S. Soccer get moving on a Division I league as part of the deal to host World Cup 1994.

(In other words, if MLS didn’t exist, you might not have had a chance to see the World Cup, though I suppose only those of us over 30 — at least — actually had that chance. I wonder how this lawsuit will affect the next U.S. bid.)

I wonder if it’s theoretically impossible to meet Stevens Act and FIFA’s expectations at the same time.

lovejoy

Everything U.S. Soccer did to try to stabilize the lower divisions over the past 10 years is now being touted as “anticompetitive.”

d2Here’s one reading of the U.S. Soccer’s decision to step into the rift within the USL, then operating in Division II and Division III: The Federation wanted to buy time for the two factions — neither of which had attained critical mass — to either work things out or solidify their own interests. So it agreed to take over and run an ad hoc Division II league for one year, during which the teams that would become the NASL managed to get their ships in relative order. The Federation also wrote stringent Division II standards that the NASL teams — but not the USL teams — could meet, all in the interest of trying to make sure teams wouldn’t fold midseason any more. (Yes, I hear you, disgruntled St. Louis Athletica fans.)

(And let’s be clear: The USL isn’t blameless here. The USL’s centralized model is the stumbling block to any possible merger between it and the NASL, NISA, NPSL, etc., and that is looking more and more like a liability at this point.)

Here’s the NASL lawsuit’s reading, repeated several times in the suit: The league was all set to go Division II and then Division I, but U.S. Soccer was in the way.

And the process of granting waivers to the Standards is deemed suspicious, even though that kept the NASL going at Division II for a few years.

Everything is part of a conspiracy.

The word “conspiracy” appears 31 times in the document.

We’ve heard these arguments for years. MLS and the USSF want to monopolize soccer in the United States. I can’t imagine a country in which that’s not the case. Granted, you can get into the top tier through promotion/relegation in other countries, but the system is still set up so that you need vast amounts of capital to do so.

The USL, which got the same provisional Division II status as the NASL this year, is considered part of the conspiracy because it’s not interested in challenging MLS and cooperates with it, allowing MLS reserve teams to compete therein. But USL-MLS relations weren’t always so great, and the NASL was close to lining up the same partnership before abruptly backing away.

The NASL seems convinced MLS was terrified of it.

Paragraph 10: “Driven in part by “concern[s] that the new NASL … would import players from South America and in essence become the anti-M.L.S. by allowing teams to sign players without worrying about a salary cap or a single-entity setup,” (citing a 2010 Bleacher Report piece) and thereby create a more attractive product for fans, the USSF has conspired with MLS and other USSF members to block the NASL from effectively competing with MLS.

As with a lot of things in Jeffrey Kessler’s lawsuits against U.S. Soccer, such as the time his side tried to convince the court that the “Premier League” and “First Division” were both “Division I” leagues in England, this is a more persuasive argument if you assume no one with any soccer knowledge will enter the courtroom. USSF lawyers will undoubtedly respond that MLS has signed plenty of players from South America and loosened its salary cap so that teams like Toronto can spend like the Sept. 23 Doomsday prediction is accurate.

Twice, the suit touts the NASL’s Open Cup record vs. MLS teams. But it’s a bit selective, spanning only the years 2012-14. THAT is when the NASL had a 42 percent win record against MLS, as claimed in the suit. And it doesn’t mention that the NASL has not yet had a team make the semifinals, much less win it. Most of those wins were against MLS reserves in the early rounds.

Also difficult to explain away from an NASL perspective: The USL, playing at a lower division, didn’t seem to have any problem staying competitive with the higher-tier NASL. If the USL could be competitive as a third-division league, why is Division II status so important to the NASL?

The NASL believes the Professional League Standards are unfair.

I’ve questioned the divisional standards before. I don’t think a Division II league, for example, should be forced to operate in three time zones. Division I? Probably.

The suit adds a fun twist on the time-zone requirement, pointing out that top leagues in England, Germany, Spain, France and Italy have no such requirement. A look at a map should explain why.

Also, the suit complains that the USA’s standard of needing 15,000 seats in every Division I stadium would mean England’s Premier League is out of compliance. Bournemouth’s inability to renovate its stadium has far-reaching consequences, doesn’t it?

But it’s not as if the NASL is close to this requirement. Its median stadium capacity is 10,000.

Other countries have standards, too. In Germany, if you want to be in the top two tiers, you need a youth academy with a jacuzzi. To reach “Step 1” (the fifth division) in England, you have to be able to separate home and visiting fans in your ground.

Still, the suit raises a few legitimate objections. Why are Division I clubs required to have a “principal owner” with an Individual Net Worth of at least $40 million, when there’s a separate requirement for an ownership group to have a combined net worth of $70 million (to which the NASL apparently does not object) and a $1 million performance bond each season? Why did a 2015 proposal to raise the standards further — itself an ill-timed idea — propose that a Division I league must have 75% of its teams in metro areas of more than 2 million people, of which there are barely 30 in the USA?

Who made the Professional League Standards so stringent in the first place?

Hat tip to BigSoccer’s Knave, who pointed out that some of the owners who split from the USL to form the NASL in the first place were pushing for tougher standards in 2010. Are any of those owners still involved?

On Jason Davis’ SiriusXM show today, Steven Bank noted that some “anticompetitive” standards may actually be procompetitive because they help clubs stay in business, which would be a change from lower divisions of the past.

But this is a recurring argument in the suit. There’s no other reason for the standards to be the way they are except to keep the NASL down. I’m not sure history backs up that claim.

Hey, what about promotion/relegation?

Paragraph 11: U.S. Soccer doesn’t do pro/rel, so there.

Paragraph 12: NASL seeks to strike down all rules on divisions.

It’s a mixed message.

Paragraph 69 repeats the dubious claim that the FIFA statutes require divisional assignment primarily on sporting merit. We’ve covered this.

Antitrust depends on defining a market that is being claimed as exclusive territory by the defendant. What’s the market here?

Steven Bank addressed this issue this afternoon on Jason Davis’ SiriusXM show:

Steve Holroyd’s response:

Why do I know so many legal people?

The suit (Paragraph 35) actually says U.S. Soccer is restraining competition in the USA AND Canada, which may come as a surprise to the people launching a new league in Canada.

Is U.S. Soccer’s structure inherently flawed?

MLS has 57.1% of the votes on the Pro Council, which means it can pretty much select the two representatives to the U.S. Soccer Board. (Though one of them now is actually Steve Malik of North Carolina FC, which is in the NASL (and NWSL) but perhaps not totally down with what’s happened this week, reports Neil Morris.)

Is that just the natural order of things, though? How many federations have multiple organizations like this? Even in U.S. Soccer, the Adult Council has one organization — the USASA, whose president, John Motta, will announce within 30 days whether he’s running for the U.S. Soccer presidency. (Breaking news, I suppose, but it’s been discussed on Twitter.)

Is U.S. Soccer obligated to have more than one Division I soccer league?

No one else does, unless you count the oddball Indian Super League, which is a weird cross between a league and a tournament.

If so, is U.S. Soccer obligated to make that second league the NASL?

In Paragraph 198, U.S. Soccer President Sunil Gulati is quoted as saying in 2007 that he figured we would have two Division I leagues in a few years.

Let’s assume for sake of argument this isn’t ripped out of context (I haven’t had a chance to check). That would mean Gulati — and apparently U.S. Soccer, since the suit alleges he and his conspirators have near-omnipotent power over it — have no objection to having a second D1 league.

So why the objection to the NASL?

Is it because the league muddled through under the guidance of since-disgraced Traffic Sports, among other troubles pointed out in an excellent overview by Soccer America’s Paul Kennedy?

Is it because the NASL brand name harkens back to the days of a popular but ill-managed league that broke every rule it could find?

Is it because the league is down to eight existing teams, some of which have their eye on the door?

Is it because, as Kartik Krishnaiyer points out in a piece that doesn’t spare the Federation, the NASL “dug its own grave“?

Or is it because U.S. Soccer has come to realize a second Division I league would muddy the waters, poison relationships with sponsors and broadcasters and result in a replay of the “Soccer Wars” that killed the American Soccer League after its 1920s heyday?

 

 

 

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