By Christopher R. Deubert, Senior Writer
In December, the law firms of Covington & Burling LLP and Weil, Gotshal & Manges LLP released a joint 125-page report detailing a history of misconduct by coaches and executives for clubs in the National Women’s Soccer League (NWSL), including instances of sexual, racial and other inappropriate comments and instances of behavior. As a result of this and related investigations, the NWSL has permanently banned five coaches from the league: Paul Riley (formerly of the Portland Thorns and North Carolina Courage); Christy Holly (Sky Blue FC and Racing Louisville); Rory Dames (Chicago Red Stars); Richie Burke (Washington Spirit); and, Kris Ward (Washington Spirit). Two others were banned until 2025: Craig Harrington (Utah Royals FC); and, executive Alyse LaHue (NJ/NY Gotham FC).
The league’s punishments raise questions as to their legal basis and potential legal challenges by the coaches.
As an initial matter, the bans appear to be based on the authority of NWSL Commissioner, Jessica Berman. A January 9 press release from the league announcing the penalties described them as having been “imposed” by Berman. The NWSL is a single-entity, meaning that it is a Delaware limited liability company in which each club is a member. Berman’s authority is likely derived from the NWSL’s Operating Agreement or a related document, such as a Bylaws and Constitution, giving the Commissioner broad authority to take action in the best interests of the league.
Courts have often been deferential to sports leagues and their Commissioners as to their judgment about what is in the best interests of their particular league. In a 1978 case involving the authority of Major League Baseball’s Commissioner to disapprove player trades, the Seventh Circuit Court of Appeals affirmed the lower court’s determination that “the Commissioner has the authority to determine whether any act, transaction or practice is ‘not in the best interests of baseball,’ and upon such determination, to take whatever preventive or remedial action he deems appropriate, whether or not the act, transaction or practice complies with the Major League Rules or involves moral turpitude.” Charles O. Finley & Co., Inc. v. Kuhn, 569 F.2d 527 (7th Cir. 1978); see also Atlanta Nat’l League Baseball Club, Inc. v. Kuhn, 432 F. Supp. 1213 (N.D. Ga. 1977) (“What conduct is ‘not in the best interests of baseball’ is, of course, a question which addresses itself to the Commissioner, not this court”); Crouch v. NASCAR, 845 F.2d 397 (2d Cir. 1988); Oakland Raiders v. NFL, 131 Cal.App.4th 621 (Cal. Ct. App. 2005).
As to the suspended coaches, each would have had an employment agreement with their particular club. That agreement likely included a provision in which the coach agreed to abide by the league’s rules and disciplinary determinations. Thus, the coaches’ agreements likely provided the NWSL with some basis to impose the discipline that it did.
Nevertheless, suspensions like that imposed here have been subject to attack as violations of antitrust law. More specifically, parties of various kinds have alleged that when a sports organization which is necessarily made up of multiple actors (e.g., teams) suspends or otherwise disciplines someone with a commercial interest in that organization, such activity constitutes an unreasonable restraint of trade in violation of Section 1 of the Sherman Antitrust Act.
The first such challenge was brought by Jack Molinas, a promising young NBA player who was indefinitely suspended by the league for gambling on games in which he played. The court denied Molinas’ claims, finding in relevant part that the league’s rule prohibiting players from gambling on games in which they play was reasonable. Molinas v. NBA, 190 F. Supp. 241 (S.D.N.Y. 1961). The NBA survived similar allegations when it forced former Los Angeles Clippers owner Donald Sterling to sell the club after making racist statements. Sterling v. NBA, 2016 WL 1204471 (C.D. Cal. Mar. 22, 2016).
Professor Marc Edelman, an expert in antitrust law, has argued that such suspensions could be considered illegal group boycotts under the antitrust laws.[1] Indeed, such arguments have been made – but failed. The NCAA fended off claims brought by a suspended coach who alleged that his suspension for rules infractions constituted an illegal group boycott. See Bassett v. NCAA, 528 F.3d 426 (6th Cir. 2008). The World Boxing Council survived similar claims from a suspended boxing promoter, Brenner v. World Boxing Council, 675 F.2d 445 (2d Cir. 1982), as did the American Horse Shows Association from a suspended horse trainer, Cooney v. Am. Horse Shows Ass’n, Inc., 495 F. Supp. 424 (S.D.N.Y. 1980). In each case, the courts found the suspensions, in sum and substance, to be sufficiently reasonable to survive antitrust scrutiny.
With these cases as precedent, the NWSL stands on strong ground in banning the coaches as it has. Nevertheless, given that these coaches are now deprived of a meaningful choice of employment in a very competitive field, it would not be surprising to see one of them give these antitrust arguments a fresh try.
Deubert is Senior Counsel at Constangy, Brooks, Smith & Prophete LLP.
[1] Marc Edelman, Are Commissioner Suspensions Really Any Different From Illegal Group Boycotts? Analyzing Whether the NFL Personal Conduct Policy Illegally Restrains Trade, 58 Cath. U. L. Rev. 631 (2009).
