This is an action pursuant to Section 301 of the Labor Management Relations Act
(the LMRA), 29 U.S.C. 185, to vacate the award issued by Arbitrator Thomas F. Gibbons
(the Arbitrator) of the American Arbitration Association on September 12, 2014, in connection
with an arbitration between US Soccer and the Players Association (the Award).
2.
Agreement between the parties to this action (the CBA/UPA). The Award holds that US
Soccer is contractually obligated to submit all non-video creatives containing the likenesses of
six or more national team players (Non-Video Creatives) to the Players Association for its
review and approval prior to their use by US Soccer sponsors. In reaching this conclusion, the
Arbitrator acknowledged the absence of such a pre-approval requirement in the text of the
CBA/UPA itself, but nonetheless added the term into the agreement on the ground that US
Soccer had engaged in a past practice of submitting Non-Video Creatives to the Players
Association for advance approval.
3.
The Award must be vacated because it draws its essence solely from the extra-
contractual conduct of the parties, disregards and contradicts the unambiguous language of the
CBA/UPA, and imposes an obligation on US Soccer not bargained for by the parties. The
CBA/UPA is clear that it is a fully integrated agreement there is no exception for the
consideration of past practice and that an arbitrator is prohibited from adding to, subtracting
from, or altering in any way its express provisions. Yet this is precisely what the Arbitrator did
when he gave legal effect to a past practice which finds no support in the clear and unambiguous
terms of the agreement. The Arbitrator thus exceeded his authority under the CBA/UPA, and as
a result, the Award cannot stand.
PARTIES
4.
Relations Act, 29 U.S.C. 152(5), and Section 301 of the LMRA, 29 U.S.C. 185. The Players
Association is the exclusive collective bargaining representative of all persons who have been or
may be selected to play for the Mens National Team and who are, therefore, employees of US
Soccer. Although the Players Association is headquartered in Washington, D.C., its
representatives regularly conduct business in the Northern District of Illinois.
JURISDICTION AND VENUE
6.
Section 301 of the LMRA gives federal courts jurisdiction to hear suits over
US Soccer also brings this action under the Federal Arbitration Act (FAA) to
the extent applicable. In the Seventh Circuit, both the LMRA and the FAA govern challenges to
labor arbitration awards, but, where the two statutes conflict, the LMRA supersedes. Smart, 315
F.3d at 724-25; Pryner, 109 F.3d at 357-58. Thus, in determining whether an arbitrator exceeded
his or her authority under a collective bargaining agreement, courts regularly apply the
procedural and substantive standards of the LMRA, and the LMRA provides the proper
jurisdictional basis for this action. See, e.g., Polk Bros., Inc. v. Chicago Truck Drivers, Helpers,
and Warehouse Workers Union, 973 F.2d 593, 596 (7th Cir. 1992); Miller Brewing, 739 F.2d at
1162; Judsen Rubber Works, Inc. v. Mg., Prod. & Serv. Workers Union Local No. 24, 889 F.
Supp. 1057, 1060-61 (N.D. Ill. 1995). But, to the extent the FAA is applicable here, US Soccer
requests that the Court treat this Complaint and any subsequent motions as a motion to vacate
under the FAA. See, e.g., Webster v. A.T. Kearney, Inc., 507 F.3d 568, 570-71 (7th Cir. 2007)
(filing of complaint rather than motion to vacate under FAA was a case of mislabeling rather
than mishandling and did not amount to reversible error).
8.
This Court has subject matter jurisdiction pursuant to 28 U.S.C. 1331 in that the
action arises under Section 301 of the LMRA. 29 U.S.C. 185(a). This Court likewise has
jurisdiction under the FAA insofar as it applies. Although the FAA does not automatically grant
subject matter jurisdiction on federal courts, the LMRA operates as an independent basis for
jurisdiction where, as here, the dispute involves a violation of a collective bargaining agreement.
See Pryner, 109 F.3d at 359 ([T]he arbitration act reaches only disputes that are within the
jurisdiction of the federal courts under some other statute, such as the diversity statute or, as
here, section 301 of the [LMRA].).
9.
This Court has personal jurisdiction over the Players Association because its
representatives engage in sufficient contacts with the State of Illinois such that the Players
Association should reasonably anticipate being haled into court there. The Players Association is
a union with national jurisdiction representing players who are employed by an organization
headquartered in Chicago, Illinois. Some of these players live in Illinois or play for a
professional team located in Illinois. As the exclusive collective bargaining representative of the
US Mens National Team players, the Players Association regularly and frequently
communicates with personnel at US Soccers headquarters in Chicago, Illinois. These contacts
include, among other things, those giving rise to the instant action namely, the negotiations
over past and present collective bargaining agreements and discussions regarding Non-Video
Creatives. In conjunction with the CBA/UPA negotiations, the Players Association agreed to an
Illinois choice-of-law provision and therefore assumed the benefits and protections of Illinois
law. In addition, after the instant dispute arose and the parties were unable to resolve their
disagreement, an Illinois-based arbitrator was appointed pursuant to the Labor Arbitration rules
of the American Arbitration Association, as provided for in Section 5.6 of the CBA/UPA.
Further, three of the six days of hearings held in connection with the arbitration were conducted
in Chicago, Illinois, US Soccer and the Players Association each submitted their post hearing
briefs to the Arbitrator at his business address in Cook County, Illinois, and the Award at issue
was rendered from the Arbitrator in Cook County, Illinois.
10.
Associations duly authorized officers and agents represent and act for its employee members in
the Northern District of Illinois and a substantial portion of the events at issue occurred in this
District. See 28 U.S.C. 1391(b); 29 U.S.C. 185(c); Reed v. UAW, Local Union No. 663, 945
F.2d 198, 201, n.3 (7th Cir. 1991) (noting that 29 U.S.C. 185(c) deal[s] with venue and not
jurisdiction but that the requirements under both [29 U.S.C. 185(c)] and the due process
minimum contacts standard have been held to be so similar that analysis under either would
yield the same result).
FACTUAL AND PROCEDURAL BACKGROUND
The CBA/UPA
11.
US Soccer and the Players Association have negotiated and executed four
CBA/UPAs since the formation of the Players Association in 1995. The version of the
CBA/UPA currently in effect was executed on February 23, 2013, and covers the period from
January 1, 2011 through December 2018.
12.
Section 6 of the UPA governs US Soccers right to use and to authorize others to
use the Likenesses of players, defined as the image, photographs, pictures (whether still or
motion, video or television), likeness, name, nickname, signature, facsimile signature, caricature,
biographical information and/or voice in any format whether now known or hereafter developed,
whether used individually or in combination. (UPA at 6(a)(i).) Subsection (b) gives US
Soccer the right to take or create, or have taken or created the likenesses of national team
players, grants US Soccer broad ownership rights in such likenesses, and authorizes their use by
US Soccer and its sponsors. (Id. at 6(b).) Subsection (b) provides in full:
Names, Pictures, Likenesses Created During Matches, Training or Federation
Sponsored Activity. Player agrees that [US Soccer] shall have the right to take or
create, or have taken or created, Likenesses of Player, including staged team
photographs, at any training or matches in which the Team participates or at any
[US Soccer] or Team sponsored activity. Player agrees that all rights in such
Likenesses shall belong to [US Soccer] and that [US Soccer], and its assigns,
agents and licensees, may use Players Likeness for Non-commercial Uses and as
set forth below. Except as set forth below, [US Soccer] may not use or allow
others to use Players Likeness without the agreement of Player or Players
representative.
(Id. (emphasis added).)
13.
which clarifies that [n]othing in this agreement shall be deemed to give the Federation the right,
without the Players prior written consent, to suggest or imply that a Player has individually
endorsed a product. (Id. at 6(d).)
14.
Subsection (f)(i) specifies the terms and procedures US Soccer must follow if a
US Soccer sponsor or partner wishes to use six or more player likenesses in an advertisement or
promotion:
Six or More Players Use By [US Soccer] Sponsor. If Players Likeness is used
by a Partner of [US Soccer] (as defined in 6(h)) for any Non-Commercial Use
or in a Partners advertising or promotions, and if the advertising, promotion, or
Non-Commercial Use includes six (6) or more members of any [US Soccer]
national team (e.g., team poster or collage), [US Soccer] will request, but not
require, the Partner to make a contribution in an amount to be determined in the
Partners sole and absolute discretion to the applicable Player Pool(s), provided
however, with respect to any use by a Partner in a Spot (as defined in 6(h)),
prior to such use, [US Soccer] shall provide a copy of such Spot to the Players
Association for its approval, which approval shall be considered in good faith.
Such uses by Partners specifically exclude any Licensing Purposes.
(Id. at 6(f)(i) (emphasis added).)
15.
The plain language of Section 6(f)(i) requires only that US Soccer request the
sponsor make a contribution to the applicable Player Pool if the sponsor uses six or more player
likenesses in an advertisement or promotion. The single exception is with respect to a Spot
defined in Section 6(h) as video commercial spots (which includes videos to be broadcast or
disseminated or posted in any medium, including television commercials) for which US
Soccer must provide a copy to the Players Association for its approval prior to such use. (Id. at
6(f)(i).) Section 6(f)(ii) documents the rationale for this exception as follows: With respect to
Spots, the Players Association has expressed concern that there is a greater likelihood of an
impermissible implied endorsement in Spots. (Id. at 6(f)(ii).)
16.
Thus, on its face, Section 6 gives US Soccer the right to authorize sponsors to use
17.
Section 6 or elsewhere requiring advance approval by the Players Association for Non-Video
Creatives. Meanwhile, in each round of negotiations, the parties agreed to insert language
mandating advance notice or pre-approval in various other circumstances, including in
connection with the use of player likenesses in video commercial spots and on merchandise for
sale (licensing purposes). Indeed, there are now more than 25 advance notice or pre-approval
requirements in the CBA/UPA, and none involves US Soccers or its sponsors Non-Video
Creatives.
18.
The CBA/UPA is a fully integrated agreement. Sections 7.1 of the CBA and
13(a) of the UPA expressly provide that substantive bargaining discussions between the parties
and their prior Collective Bargaining Agreement and Uniform Player Agreement may be offered
and considered by the Impartial Arbitrator, if deemed appropriate by him or her. With that
exception, it is intended that [the CBA/UPA] shall be deemed the complete agreement between
the parties and no understanding contained in [the CBA/UPA] shall be modified, altered or
amended, except by a writing signed by the party against whom enforcement is sought. (CBA
at 7.1; UPA at 13(a).) There is no language in the CBA/UPA giving an arbitrator the
authority to rely on evidence of past practice as a basis for varying the terms of the parties
agreement. Additionally, the UPA contains a no-waiver clause, which provides that the
failure of either party to insist, in any one or more instances, on the performance of any terms or
conditions of this Agreement shall not be construed as a waiver or relinquishment of any rights
granted hereunder or of the future performance of any such term or condition. (UPA at
13(c).)
19.
Article V of the CBA sets forth the requisite grievance and arbitration procedures
in the event of a dispute over the CBA/UPAs terms, including the selection of an impartial
arbitrator. But, and confirming the importance of the integration clauses in the CBA/UPA to the
parties, US Soccer and the Players Association agreed significantly to restrict the powers of the
impartial arbitrator by providing in Section 5.8 of the CBA that the Impartial Arbitrator will not
have the jurisdiction or authority to add to, subtract from, or alter in any way the provisions of
this Agreement or any Uniform Player Agreement. (CBA at 5.8.)
20.
approval for Non-Video Creatives; the written agreement is fully integrated; the parties do not
relinquish their rights under the contract merely because they do not invoke them; and the
impartial arbitrator is prohibited from modifying the provisions of the agreement in any way.
The Past Practice
21.
Despite the lack of a pre-approval requirement on the face of the CBA/UPA for
Non-Video Creatives, US Soccer nonetheless began submitting such creatives to the Players
Association for review by 2004 and for approval by 2007. It did so out of concern that the
Players Association would object to a sponsors use of player likenesses after-the-fact and seek
to enjoin the use through the grievance and arbitration process. If the Players Association were
successful, the sponsor could be forced to pull its advertisements, which would prove both
embarrassing and costly and which would, in turn, negatively impact US Soccers sponsor
relationships and reputation. Rather than face these back-end risks, US Soccer chose to work
cooperatively with the Players Association in an attempt to facilitate sponsor activation and
promote the sport of soccer while avoiding unnecessary disputes.
22.
approval from the Players Association because sponsors submitted relatively few Non-Video
Creatives. However, as the popularity of the sport increased, the number of US Soccer sponsors
grew, and so, too, did the number of Non-Video Creatives submitted for Players Association
consideration. In the face of this heightened demand, the Players Association became
increasingly obstructionist and erratic in its review of Non-Video Creatives. Ultimately, the
back-end risks no longer outweighed the costs associated with seeking advance approval from
the Players Association. US Soccer thus decided to conform to the bargained-for language in the
CBA/UPA and notified the Players Association that it would stop seeking approval for NonVideo Creatives on February 20, 2014. In response, the Players Association filed a demand for
arbitration on February 27, 2014.
The Arbitration
23.
Hearings were held before the Arbitrator on April 28, 29, and 30, 2014 in
The credible evidence submitted at the hearings showed that: (1) the parties never
intended the pre-approval requirement for video commercial spots to apply to Non-Video
Creatives; (2) US Soccer made no oral representations to the Players Association that preapproval was required for Non-Video Creatives; (3) the practice of submitting Non-Video
Creatives for advance approval was based on a business decision and not on an interpretation of
US Soccers obligations under the CBA/UPA; (4) US Soccer informed the Players Association
on multiple occasions that it was not contractually obligated to submit Non-Video Creatives for
approval; and (5) US Soccer decided to change its practice as a result of the Players
Associations inconsistent and increasingly restrictive behavior.
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25.
26.
On September 12, 2014, the Arbitrator rendered the Award and framed the issue
The Arbitrator further proclaimed that the absence of language requiring advance
approval creates an ambiguity again, without textual support and looked outside the plain
language of the agreement to decipher the parties intent. (Id. at p. 40.) Although the Arbitrator
admitted that the other advance notice provisions and the provided however language are
relevant to the parties intent, he nonetheless declared the past practice dispositive and
determined that US Soccer is obligated to continue to follow the practice. (Id.)
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28.
requirement that US Soccer seek the Players Associations advance approval for Non-Video
Creatives, and thereby exceeded the express limitations on his authority in CBA Section 5.8
which specifically precludes him from doing so.
CLAIM FOR RELIEF
29.
US Soccer incorporates paragraphs 1 through 28, above, as though fully set forth
30.
The Arbitrator exceeded his authority because his Award fails to draw its essence
herein.
from the CBA/UPA. Rather than interpret the text of the agreement, the Arbitrator looked to the
extra-contractual conduct of the parties to impose a restriction on US Soccer that is unsupported
by and inconsistent with the plain and carefully negotiated language of the CBA/UPA. Indeed,
the Arbitrator derived the Award solely from a past practice.
31.
A review of both the relevant terms in the CBA/UPA and the Arbitrators own
words makes clear that the basis for the Award is non-contractual. First, there is no possible
interpretive route from the language of the CBA/UPA to the Award. In fact, the Arbitrator
conceded that there is no specific provision in the CBA/UPA that requires US Soccer to submit
Non-Video Creatives to the Players Association for advance approval. (Award at p. 21.) Quite
the opposite, the language of the CBA/UPA unambiguously reveals that there is no pre-approval
requirement for Non-Video Creatives. In the words of the Arbitrator, the CBA/UPA clearly
contemplates and certainly anticipates such uses. (Id. at pp. 21, 40.) Specifically, Section
6(b) authorizes such uses and 6(f)(i) lists the terms under which the authorization of such uses is
made; yet there is no mention of an advance approval requirement for Non-Video Creatives in
the agreement despite the fact that the parties clearly knew how to draft advance notice
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provisions and did so in numerous other circumstances. The presence of (1) more than 25 other
advance notice or pre-approval provisions in the CBA/UPA including the express pre-approval
requirements for video spots, licensing uses, and footage, (2) the provided however language
separating the general voluntary contribution requirement from the specific approval process
for video spots, and (3) the express rationale for the video spot approval process that there is a
greater likelihood of an impermissible implied endorsement in Spots reveals one thing and
one thing only that there is no advance approval requirement for Non-Video Creatives. There
is simply no aspect of the CBA/UPA that could justify the Arbitrators Award.
32.
Notwithstanding the fact that the contractual text does not so much as hint at the
existence of a pre-approval requirement for Non-Video Creatives, the Arbitrator wrote such a
requirement into the agreement. His justification for doing so is conclusory and lacking in bona
fide contractual interpretation. After recognizing that there is no specific provision in the
CBA/UPA requiring advance approval for Non-Video Creatives (Award at p. 21), the Arbitrator
abruptly concluded, It is uncontested that the contract is silent as to [any approval process for
Non-Video Creatives]. (Id. at p. 39.) A quick glance at the Table of Contents of US Soccers
Post Hearing Brief reveals that this statement is factually incorrect. (See US Soccers Post
Hearing Brief at pp. ii, 54 (The CBA/UPA is not silent on the issue of whether Non-Video
Creatives require Players Association advance approval).) More importantly, it suggests that
the Arbitrator assumed the CBA is silent on the issue due to a misperception of the parties legal
arguments as opposed to his own interpretation of the text. The Arbitrator further equated
silence with ambiguity but failed to address how, in light of the existing contract language, the
absence of an explicit pre-approval process for Non-Video Creatives creates an ambiguity as to
13
whether such a process exists. Rather, the absence of an advance approval requirement for the
clearly contemplated use unambiguously reveals that there is no such requirement.
33.
In fact, the Arbitrator written opinion affirmatively reveals that he drew his
Award from a past practice notwithstanding the contractual language. At the outset of his
opinion, he stated that his task was to determine whether the terms of the Agreements or the
past dealings between the parties require the Player Associations advance approval for NonVideo Creatives, even though the Arbitrators decision-making authority was expressly limited
to determining what the terms of the CBA/UPA require and he was expressly prohibited from
adding to, subtracting from, or altering in any way the provisions of the CBA/UPA. (Award at
pp. 5-6 (emphasis added).) The Arbitrator, moreover, acknowledged the relevance of the other
advance notice/pre-approval provisions and the provided however language, but he proceeded
to ignore the plain import of this language in favor of the past practice. The relevant portion of
his opinion reads:
The fact the parties have included specific approval language in the past into the
contract is relevant, especially when considering the provided however
language in Section 6(i) and the inclusion of an approval process for video
commercial spots. However, one cannot ignore that U.S. Soccer has openly and
repeatedly forwarded print creatives to the Players Association for its review and
approval for more than a decade. It would defy sound judgment to draw a
conclusion as to the intent of the parties by considering only actions they did not
take but refusing to look squarely at actions they did take.
(Id. at p. 40.) The Arbitrator mentioned the textual context, not as a basis for considering past
practice but rather as an alternative interpretive device to the use of past practice. And he
disregarded the former in favor of the latter. Indeed, he admitted that he drew his conclusion
from the past practice (the actions the parties did take) over the lack of a pre-approval process
for Non-Video Creatives in the language of the contract itself (the actions the parties did not
take). Notably, the Arbitrator did not address the express rationale for requiring Players
14
Association approval for the use of six or more player likenesses in video commercial spots in
Section 6(f)(ii) because there is a greater likelihood of an impermissible implied
endorsement with respect to such spots.
34.
The Arbitrators improper reliance on past practice is all the more glaring in light
of the integration, no-waiver, and no-modification clauses which are part of the governing
agreement. While the Arbitrator briefly remarked upon these provisions, he violated the clear
limits on his authority that these provisions delineate by imposing an obligation on US Soccer
contrary to the written agreement. The Arbitrator insisted that the Award does not violate the
arbitration clause because an arbitrator is not adding to a contract by interpreting ambiguous
language but instead is giving meaning to the existing disputed language to reflect the intent of
the parties. (Award at p. 52.) Yet, as noted above, nowhere in his 40-plus page opinion did the
Arbitrator specify what language is in dispute or how it indicates silence or ambiguity on the
question at issue. Nor could the Arbitrator have grounded his conclusions in the text as there is
no logical interpretive route from the contractual language to his holding. Rather, the Arbitrator
derived his Award exclusively from a past practice. The Award is not just wrong; it disregards
the CBA/UPA completely.
WHEREFORE, Plaintiff/Petitioner US Soccer respectfully requests that this Court (1)
vacate the Award, (2) declare that the CBA/UPA does not require US Soccer to submit NonVideo Creatives to the Players Association for advance approval, and (3) grant such further relief
as the Court deems just and proper.
15
Respectfully submitted,
/s/ Casandra L. Thomson______
Casandra L. Thomson
LATHAM & WATKINS LLP
355 South Grand Avenue
Los Angeles, California 90071
(213) 485-1234
Robin M. Hulshizer
LATHAM & WATKINS LLP
330 North Wabash Avenue, Suite 2800
Chicago, Illinois 60611
(312) 876-7700
Attorneys for Plaintiff/Petitioner
United States Soccer Federation, Inc.
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