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Dallas Texans Soccer Club v. Major League Soccer Players Union

United States District Court, E.D. Texas, Sherman Division

March 29, 2017

DALLAS TEXANS SOCCER CLUB, CROSSFIRE FOUNDATION, INC., SOCKERS FC CHICAGO, LLC
v.
MAJOR LEAGUE SOCCER PLAYERS UNION, CLINT DEMPSEY, DEANDRE YEDLIN, MICHAEL BRADLEY

          MEMORANDUM OPINION AND ORDER

          AMOS L. MAZZANT UNITED STATES DISTRICT JUDGE.

         Pending before the Court is the Motion of Defendant Major League Soccer Players Union to Dismiss for Lack of Personal Jurisdiction (Dkt. #11). Having considered the pleadings, the Court finds the motion should be granted.

         BACKGROUND

         Plaintiffs are three youth soccer clubs located in the United States. Each youth soccer club is associated with the United States Soccer Federation, Inc. (the “U.S. Soccer Federation”), which is a Federation Internationale de Football Association (“FIFA”) national association member. FIFA national association members must adopt FIFA rules and regulations, except when compliance with a specific FIFA rule is illegal under national law.

         Under FIFA rules, professional soccer clubs must pay youth soccer clubs that trained players certain fees called training compensation and solidarity fees. When a player signs his or her first contract with a professional soccer club in a different national association, the professional soccer club must pay the youth club training compensation. When a player is transferred to a professional soccer club in a different national association, the professional soccer club acquiring the player must pay the youth club a solidarity fee. Disputes over the payment of training compensation and solidarity fees are adjudicated by FIFA's Dispute Resolution Chamber in Zurich, Switzerland.

         Plaintiffs initiated administrative proceedings before the Dispute Resolution Chamber seeking either training compensation or solidarity fees in connection with the signing or transfer of players Plaintiffs trained. Specifically, Plaintiff Dallas Texans Soccer Club (the “Dallas Texans”) trained Clint Dempsey and is seeking a solidarity fee in connection with Dempsey's transfer to Major League Soccer, LLC from the Football Association of the United Kingdom. Plaintiff Crossfire Foundation Inc. (“Crossfire”) trained Deandre Yedlin and is seeking a solidarity fee in connection with Yedlin's transfer to the Football Association of the United Kingdom from Major League Soccer, LLC. Plaintiff Sockers FC Chicago, LLC (“Sockers”) trained Michael Bradley and is seeking a solidarity fee in connection with Bradley's transfer to Major League Soccer, LLC from the Italian Football Federation. Plaintiff Sockers also trained Eric Pothast and is seeking training compensation in connection with his signing with Angelholms FF of the Swedish Football Association.

         Defendant Major League Soccer Players Union (the “Players Union”) is the exclusive collective bargaining representative of all players selected to play in Major League Soccer, LLC. The Players Union represents fifty-nine players in Texas, including at least twenty-one players from the Dallas Texans. The Players Union has two union representatives continuously present in Texas and sends employees to meet with players in Texas. The Players Union is an unincorporated association with offices in Bethesda, Maryland.

         On May 24, 2016, Plaintiffs, the Players Union, the U.S. Soccer Federation, and professional soccer leagues met in Chicago, Illinois, to discuss a training compensation and solidarity fee system for U.S. youth clubs. Plaintiffs allege that during this meeting, Bob Foose, the Executive Director of the Players Union, stated that any effort by Plaintiffs to enforce training compensation or solidarity fees would violate federal antitrust law. Plaintiffs also allege that a representative from Major League Soccer, LLC alerted U.S. youth club representatives that the Players Union threatened to file an antitrust lawsuit against Plaintiffs, the U.S. Soccer Federation, and others if the Dispute Resolution Chamber awarded Plaintiffs training compensation or solidarity contributions.

         On July 1, 2016, Plaintiffs filed a Class Action Complaint for Declaratory Relief against the Players Union, Dempsey, Yedlin, Bradley, and all those similarly situated (Dkt. #1). Plaintiffs seek a declaration that any U.S. youth club's receipt of training compensation or solidarity fees does not violate antitrust laws. Plaintiffs also seek a declaration that the implementation of a system of training compensation and solidarity fees for player transactions within the U.S. does not violate antitrust laws.

         On November 3, 2016, the Players Union filed the pending motion to dismiss for lack of personal jurisdiction (Dkt. #11). On December 1, 2016, Plaintiffs filed a response (Dkt. #23). The Players Union filed a reply on December 21, 2016 (Dkt. #34).

         LEGAL STANDARD

         Federal Rule of Civil Procedure 12(b)(2) requires a court to dismiss a claim if the court does not have personal jurisdiction over the defendant. Fed.R.Civ.P. 12(b)(2). After a nonresident defendant files a motion to dismiss for lack of personal jurisdiction, the party seeking to invoke the court's jurisdiction must “present sufficient facts as to make out only a prima facie case supporting jurisdiction.” Alpine View Co. v. Atlas Copco AB, 205 F.3d 208, 215 (5th Cir. 2000). When considering the motion to dismiss, the court must accept as true the plaintiff's uncontroverted allegations and resolve factual conflicts in favor of the plaintiff. Id.

         A federal court may exercise personal jurisdiction over a nonresident defendant if (1) the forum state's long-arm statute confers personal jurisdiction over that defendant, and (2) the exercise of personal jurisdiction comports with the due process clause of the Fourteenth Amendment. Int'l Energy Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd., 818 F.3d 193, 212 (5th Cir. 2016). Because the Texas long-arm statute extends as far as constitutional due process permits, a court only needs to determine whether a suit in Texas is consistent with the due process clause of the Fourteenth Amendment. Id. The due process clause requires that a court exercise personal jurisdiction over a nonresident defendant only if the defendant has “certain minimum contacts with [the forum state] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Id. (citing Int ...


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