Court Denies NASL Request for an Injunction

Inaria - New York Cosmos

nasl logoThe future of the North American Soccer League was thrown into doubt once again after the league was denied the injunctive relief it was seeking in United States District Court for the Eastern District of New York in Brooklyn to remain a Division II league in 2018.

Judge Margo K. Brodie filed her 49-page written decision on the injunction request in the league’s antitrust lawsuit against the U.S. Soccer Federation early Saturday morning. The NASL request to the court was to “maintain the status quo” by allowing it to keep its Division II sanction, but Judge Brodie disagreed. She asserted that since the USSF had already revoked the sanctioning for next year, the league was, in reality, seeking a mandatory injunction that required a much higher burden of proof

“Although designated as a Division II league for 2107, Plaintiff has already been denied Divsion II status for 2018,” Brodie wrote. “Plaintiff’s requested relief would disrupt the status quo by effectively requiring Defendant to reverse its previous denial. With or without court intervention, Plaintiff required Defendant to act affirmatively in its favor to receive any designation in 2018.”

The court sided with the NASL on the issue of irreparable harm. While Judge Brodie noted that the USSF could suffer harm by the injunction by having its status as the country’s regulator of the soccer questioned, she ultimately was swayed by the NASL’s argument that the threat of it closing down was more dire.

Where the NASL’s request fell short, though, was providing sufficient evidence to prove collusion among the USSF, Major League Soccer and Soccer United Marketing to influence votes by the federation’s board of directors and its Professional League Standards that are at the heart of the league’s lawsuit. At the moment, Brodie believes the league has failed to show more than circumstantial evidence of a conspiracy to prevent it from challenging MLS.

The USSF argued that all board members with affiliations to professional leagues recused themselves from voting on sanctioning and PLS decisions were in line with standard practices to eliminate conflicts of interest.

“The court finds that, based on the limited evidence before it, Plaintiff has failed to establish a ‘clear showing’ of entitles to relief based on the reasonableness of the restraint, in addition to its failure to demonstrate concerted action,” she wrote. “The Court is satisfied that the pleadings and the accompanying declarations have demonstrated a plausible claim for relief, but that is not the standard the Court is required to apply in deciding Plaintiff’s preliminary injunction motion.”

Brodie acknowledged that there was cause for concern with the strong financial and business ties between USSF and MLS. However, without stronger evidence, the court could not grant the injunction.

“At the very least, Plaintiff must provide evidence that there was an agreement to agree to vote a particular way, compromising each individual Board member’s independence.”

She continued, “While there is ample evidence of a conflict of interest between Defendant and MLS, Plaintiff fails to present sufficient evidence of undue influence in the actual standard-setting process, i.e., the process pursuant to which the PLS is revised.”

The NASL has maintained since filing its lawsuit that the injunction was critical to the league continuing operations next year. New York Cosmos owner Rocco Commisso has stated numerous times that moving to the third tier is a non-starter for him and some other NASL owners because of the limited revenue available at that level. It remains to be seen if Commisso & Company will stick that that stance now that they face extinction.

Teams with the financial means will likely have options either in the United Soccer League or the prospective National Independent Soccer Association that may launch next year in either Division II or Division III. Reports already have North Carolina FC ready for the jump to USL.

Interim NASL Commissioner Rishi Sehgal released a statement after Judge Brodie’s decision, saying the league intends to continue the antitrust lawsuit and weigh all its legal options, including an appeal of the injunction decision.

“We are very disappointed with the Court’s decision in denying our motion for a preliminary injunction,” Sehgal said. “We remain steadfast in our pursuit of antitrust claims against the U.S. Soccer Federation and are confident that justice will ultimately be served. In light of the extreme harm this decision poses to the NASL and our teams, players, coaches and fans, we will immediately begin reviewing all of our legal options including the process for appealing today’s ruling.”

U.S. Soccer also released the a statement (it was written in all capital letters, for some reason).

“US Soccer’s responsibility is to ensure the long-term stability and sustainability of all professional leagues operating in the United States, as well as the teams that compete within those league,” the statement read. “After providing numerous opportunities over the year for the NASL to meet the professional league standards, or at least provided a pathway to meet those standards, the elected and independent members of the US. Soccer Board of Directors ultimately made a decision not to sanction the NASL as a Division 2 league. The decision was made in the best interest of soccer in the United States, and today’s decision confirms it was the correct decision. U.S. Soccer is committed to finding ways to improve the long-term viability of all leagues and teams and, by doing so, continue building upon the growth of soccer in the United States. U.S. Soccer is committed to working with NASL as it considers its future.”