Christopher R. Deubert, Senior Writer
On December 15, 2022, Advocate General Athanasios Rantos of the Court of Justice of the European Union issued a preliminary opinion for the Court’s consideration in a dispute between the proposed “European Super League” and the Union of European Football Associations (UEFA) and the Federation Internationale de Football Association (FIFA). Judge Rantos’ decision echoes of the ongoing litigation between LIV Golf and the PGA Tour in interesting ways.
The Super League is an effort by the twelve best soccer teams in Europe to form a new league separate from the national leagues in which they participate. For example, among its intended participants are Real Madrid of La Liga (Spain) and Manchester United of the Premier League (England). The thinking behind the Super League is that by creating regular contests between the most popular clubs on the continent, they could tap into new revenue streams. To protect the clubs’ investment in the league, membership would be “closed,” i.e., there would be no promotion and relegation as is a general feature of European sports leagues.
The Super League concept bears similarity to LIV Golf’s efforts to disrupt professional golf by creating new events with lucrative prize pools intended to draw the best golfers in the world.
Nevertheless, both upstarts have run into legal woes. In August, several LIV golfers, led by Phil Mickelson, sued the PGA Tour alleging that its decision to suspend any golfer that participated in a LIV Golf event violated antitrust laws. The golfers sought a temporary restraining order against the suspensions.
Judge Beth Freeman of the Northern District of California denied the golfers’ request. In finding that the golfers had failed to demonstrate irreparable harm, the court noted that the golfers “are not barred from playing professional golf against the world’s top players, from earning lucrative prizes in some of golf’s highest-profile events, from earning sponsorships, or from building a reputation, brand, and fan following in elite golf. The only thing [the golfers] are barred from is pursuing these goals at PGA TOUR events.” Mickelson v. PGA Tour, Inc., 22-cv-04486, 2022 WL 3229341, at *5 (N.D. Cal. Aug. 10, 2022) (emphasis in original). In other words, the golfers chose to play in another league for economic reasons and cannot then be heard to complain about being excluded from the league they chose to leave. The case is ongoing.
Similar to the LIV golfers, the Super League sued FIFA and UEFA, the global and European soccer governing bodies respectively, after they threatened to sanction and bar any clubs or players that participated in the Super League. The Super League alleged that such actions violate European competition (antitrust) law. A Spanish court referred the matter to the Court of Justice in a process designed to ensure uniform application of European Union law.
Here, the legal process diverges from American practice. Under the Court of Justice’s rules, the referral by the Spanish court calls for a preliminary, non-binding ruling from an Advocate General after a full briefing and hearing. The Advocate General’s ruling is then reviewed by the Court for either adoption or additional proceedings. The process is akin to a federal magistrate judge issuing a report and recommendation to a district court judge under Rule 72 of the Federal Rules of Civil Procedure.
In the Super League matter, Advocate General Rantos, like Judge Freeman, was unmoved by the upstart’s complaints, writing that “[f]rom the perspective of competition law, an undertaking (or an association of undertakings such as UEFA) cannot be criticized for attempting to protect its own economic interests, in particular in relation to such an ‘opportunistic’ project that would risk weaking it significantly.” Further, Advocate General Rantos, again like Judge Freeman, was unsympathetic to the claimant’s efforts to maintain “dual membership.”
Advocate General Rantos based his opinion in part on the special nature of the “European Sports Model,” as protected by Article 165 of the Treaty on the Functioning of Europe (TFEU), one of the foundational treaties of the bloc. Article 165 recognizes the European Union’s interest in “developing the European dimension in sport, by promoting fairness and openness in sporting competitions and cooperation between bodies responsible for sports, and by protecting the physical and moral integrity of sportsmen and sportswomen, especially the youngest sportsmen and sportswomen.” Advocate General Rantos recognized this provision as providing a constitutional preference for “a pyramid structure with, at its base, amateur sport and, at its summit, professional sport.” The Super League ran afoul of this structure and thus, according to Advocate General Rantos, was less deserving of protection under European Union law. Specifically, he found FIFA and UEFA’s rules in support of “legitimate objectives,” including “the principles of participation based on sporting results, equal opportunities and solidarity upon which the pyramid structure of European football is founded.”
Advocate General Rantos thus proposed that European Union competition law “must be interpreted as not prohibiting FIFA, UEFA, their member federations or their national leagues from issuing threats of sanctions against clubs affiliated to those federations when those clubs participate in” the Super League. The Advocate General did, however, find that the threatened sanctions against the players unwarranted since they not been involved in the creation of the Super League (whereas the LIV golfers have had varying levels of involvement in that tour’s genesis).
The Super League was temporarily or perhaps permanently shelved due to backlash from all corners of European society. While the Court of Justice may overrule Advocate General Rantos’ preliminary opinion, the odds are clearly against the Super League. An affirmation of the opinion may finally be the death knell for the long dreamed of Super League.
As for LIV Golf, it remains to be seen whether the PGA Tour’s currently enforced prohibition against dual membership will prevent further defections and/or cause any golfers to return to the Tour. Either way, the Tour may wish to cite the Court of Justice’s recent opinion as persuasive authority for the proposition that existing sports leagues are within their rights to protect their businesses from innovative challengers.
Deubert is Senior Counsel of Constangy, Brooks, Smith & Prophete LLP