The 7th U.S. Circuit Court of Appeals has reversed a district court and ruled in favor of the United States Soccer Federation, Inc. (USSF), the national governing body for soccer in the United States, in a case in which the United States National Soccer Team Players Association, the labor union for members of the Men’s National Team, filed a grievance over the use of the players’ likeness in a Tequila poster advertisement.
At issue was an interpretation of the collective bargaining agreement and uniform player agreement (CBA/UPA), and whether or not players association’s approval is required.
The court noted early on in its analysis that the agreement between the two calls for an impartial arbitrator, if there is a dispute, who “will have full, final and complete disposition of the grievance, as the case may be, and will be binding upon the player(s) involved and the parties to this agreement.”
Section 6 of the UPA governs the use of player likenesses taken or created during USSF activity. Under Section 6(b), “except as set forth below, the USSF may not use or allow others to use player’s likeness without the agreement of player or player’s representative.” One such exception occurs in Section 6(f)(i), which governs sponsor use of player likenesses for groups of six or more players. In such instances, the sponsor may make a donation to a pool set aside for the players association. But the agreement is silent on whether approval from the players association is needed.
In 2013, the players association disapproved a proposed print creative submitted by the USSF —a poster advertisement for el Jimador, a popular mid-shelf tequila brand. On February 20, 2014, the USSF issued a declaration to the players association, stating that it had “no contractual obligation to submit print/digital creative pieces containing the likeness of six (6) or more national team players to the players association for its advance approval” and would no longer be doing so in the future.
On February 27, 2014, the players association filed a grievance and demanded arbitration under the CBA/UPA, claiming that the USSF’s declaration constituted an anticipatory breach of the CBA/UPA.
Following six days of hearings, on September 12, 2014, the arbitrator found for the players association, framing the issue before him as follows:
“Whether the USSF, under the terms of the Collective Bargaining Agreement and the Uniform Players Agreement, is required by the terms of the agreements or past dealings between the parties to submit to the United States National Soccer Team Players Association for its advance review and approval non-video print and digital creatives containing the likenesses of six (6) or more players to be used by [the USSF] or its sponsors in noncommercial or advertising and promotional materials?”
The arbitrator concluded that “the long-standing practice of submitting print creatives to the players association for its approval is an implied term of the CBA/UPA by virtue of a bona fide past practice” and entered an award in favor of the players association.
Subsequently, the USSF filed suit in federal district court to vacate the arbitrator’s award, pursuant to § 301 of the Labor Management Relations Act, 29 U.S.C. § 185, arguing that the arbitrator exceeded his authority by relying on the parties’ past practice instead of the express terms of the CBA/UPA. The players association counter-claimed for enforcement of the award. Both parties moved for summary judgment.
On September 29, 2015, the district court denied the USSF’s motion and granted the players association’s motion, confirming the arbitrator’s award. United States Soccer Fed’n, Inc. v. United States Nat’l Soccer Team Players Ass’n, 140 F. Supp. 3d 738, 741 (N.D. Ill. 2015). The USSF appealed.
The 7th Circuit held that the CBA/UPA “was not silent with regard for sponsor use of print creatives; it expressly provided that the USSF ‘request, but not require’ a sponsor donation to a player pool. Therefore, there was no ambiguity or gap for the arbitrator to fill, and the players association’s argument fails.
“The Players Association’s remaining arguments are merely additional attempts to characterize the arbitrator’s award as falling within his authority under the CBA/UPA. ,,, The arbitrator’s award exceeded his authority, pursuant to CBA § 5.8, because he ignored and contradicted the clear and unambiguous terms of the agreement.
“In conclusion, we recognize that a goal of arbitration is to provide the parties with ‘swift, inexpensive and final decisions,’ but ‘this does not vitiate judicial review of an arbitrator’s decision.’ Anheuser-Busch, 280 F.3d at 1144. Here, just 22 No. 15-3402, as the parties agreed to arbitration, they also agreed ‘to limit the arbitrator’s authority and preserve their right to challenge decisions when the arbitrator had reached out and rendered a decision that strayed beyond his delegated authority and is barred by the negotiated contract.’” Id.
Attorneys of Record: (for USSF) Melissa Arbus Sherry, Benjamin W. Snyder, Russell F. Sauer Jr. and Noah Fischer of Latham & Watkins LLP.
United States Soccer Federation, Inc. v. United States National Soccer Team Players Association; 7th Cir.; No. 15-3402; 9/22/16
