On Friday, three American youth soccer clubs filed a class action lawsuit in a federal court in Texas against the MLS Players Union, three current and former MLS players—DeAndre Yedlin, Michael Bradley, and Clint Dempsey—and the defendant class, in an attempt to recoup hundreds of thousands of dollars in training and solidarity fees. A win or even a settlement between the parties could force a dramatic restructuring of the U.S. youth soccer system.
"The class is so numerous and geographically widespread that joinder of all members is impracticable," reads the complaint, which was obtained by VICE Sports. "At a minimum, the class consists of thousands of players."
The teams—the Dallas Texans; Crossfire Premiere of Redmond, Washington; and Sockers FC of Chicago—are seeking a declaratory judgment from the court that allows them and any other U.S. youth team to collect fees for the international transfer of U.S. players, and for the court to declare that it is legal for these youth teams to arrange a domestic compensation fee system with the U.S. Soccer Federation, MLS, and any other American professional soccer league.
The three youth teams specifically claim they are owed compensation from profits resulting from the international transfer of several former players (the Texans with Dempsey, Crossfire with Yedlin, and Sockers with Bradley). Dempsey, now with MLS's Seattle Sounders, previously played for Fulham and Tottenham Hotspur of the English Premier League; Bradley, now with MLS's Toronto FC, previously played for SC Heerenveen of the Dutch Eredivisie, Borussia Mönchengladbach of the German Bundesliga, and Chievo and Roma of Italy's Serie A; Yedlin joined Tottenham in 2015 and played on loan with Sunderland last season. Although not named as an individual defendant, Eric Pothast, who signed with the Swedish team Angelholms FF in 2014, and who was a youth player for Sockers FC, was also named in the complaint.
Article 21, Section VII of the FIFA Regulations on the Status and Transfer of Players states, regarding solidarity compensation: "If a professional is transferred before the expiry of his contract, any club that has contributed to his education and training shall receive a proportion of the compensation paid to his former club (solidarity contribution). "
But the U.S. Soccer Federation, citing 1998's Fraser vs. MLS antitrust lawsuit, has repeatedly said that U.S.-based youth teams cannot collect these fees. Additionally, U.S. Soccer mandates that all domestic professional leagues—MLS, the North American Soccer League, etc.—follow these guidelines. However, that might be changing.
In January, Sports Illustrated reported that several of the interested parties in this ongoing dispute had met at U.S. Soccer headquarters in October 2015. In that meeting, SI reported, the youth teams laid out the case that Fraser does not apply to FIFA's Regulations on the Status and Transfer of Players. USSF appeared to accept their argument.
"If the Fraser stipulation did apply to training compensation and solidarity, it only prevents USSF from taking any action with respect thereto.... USSF indicated at the Oct. 16 meeting that this was their interpretation," the clubs said in a statement at that meeting, according to SI.
Yedlin transferred from the Seattle Sounders to Tottenham of the EPL in 2015 for a reported $4 million. Photo by Mark J. Rebilas-USA TODAY Sports
Even MLS has softened its stance on the issue. In his state of the union address in December, commissioner Don Garber said the league was open to finding a solution. The only holdup has been the MLS Players Union, who have threatened to file an antitrust lawsuit against the youth teams if they pursued receiving solidarity fees, according to the class action lawsuit complaint.
"This action arises from the threat by the MLSPU on behalf of, and along with the individual Defendants, to bring an antitrust suit against the US Youth Clubs for attempting to obtain solidarity fees and training compensation from professional soccer clubs arising from international player transactions in accordance with the Regulations on the Status and Transfer of Players ('RSTP') of the Federation Internationale de Football Association ('FIFA') (Ex. A)," the complaint reads. "The US Youth Clubs have initiated administrative suits in the Dispute Resolution Chamber ('DRC') of FIFA, in Zurich, Switzerland against several professional soccer clubs to obtain monetary awards of solidarity fees and training compensation from the international transfer of US players. The awards to the US Youth Clubs are imminent."
The complaint also details a May 24th meeting this year in which MLS Players Union executive director Bob Foose, "openly argued that it would be an act of antitrust against its US player members and illegal in the US for the US Youth Clubs to enforce, anywhere in the world, an award from the FIFA DRC of solidarity fees or training compensation. The MLSPU also stated that it would be an act of antitrust against its US player members for the US Youth Clubs, USSF, and the professional clubs to agree to a domestic reward system within the US to implement and enforce training compensation and solidarity fees, similar to the FIFA RSTP."
The complaint added: "At the May 24th meeting, a representative from the MLS alerted the representatives of the US Youth Clubs that the MLSPU and affected member players threatened to bring an antitrust lawsuit against the US youth clubs, MLS, USSF, and FIFA upon any of the US Youth Clubs receiving an award of training compensation or solidarity fees from the FIFA DRC."
The complaint also says:
A spokesman for the youth clubs said in a statement:
"The US Youth Clubs had to name the players, Dempsey, Yedlin and Bradley, as well as the defendant class of players, solely for a legal reason to maintain the Complaint. Our clubs have no desire to, in essence, sue their own kids and don't really believe the players are needed here to resolve this, but the law is what it is. The US Youth Clubs have asked the MLSPU to stipulate that the players are not needed to maintain this action and if they agree, the US Youth Clubs will immediately drop the players."
A phone call and email to Foose was not immediately returned.
On June 29, 2015, Crossfire became the first team to challenge the Fraser case stipulated guidelines when they petitioned FIFA's Executive Committee for the right to collect fees on the reported $4 million transfer of Yedlin from the Seattle Sounders to Tottenham. In July of last year, Crossfire received permission from FIFA to file a complaint over these fees with the organization's Dispute Resolution Chamber, an independent arbitration tribunal set up by FIFA to settle private legal disputes. Since then, several other youth teams have filed similar complaints with the DRC.
The percentage of what a youth club can collect is calculated by the amount of time the player spent at the youth club, and the age of the player during the time he spent at the club. For example, Yedlin's official FIFA paperwork states he trained with Crossfire from 2008-10, although Crossfire claims he trained there starting in 2004. Previous estimates are that Crossfire could be owed as much as $100,000 through Yedlin's transfer.
Decisions from the DRC on these cases are expected soon. Regardless, representatives from the youth clubs are seeking a judgment in U.S. court in hopes of setting up a compensation system.