Athletes and product advertisements tend to go hand in hand. Back in 1939, Babe Ruth hawked products like Red Rock Cola as "The Finest Cola Drink I Ever Tasted" and today, we find athletes like Victor Cruz touting the benefits of "filling up right" with Campbell's soup. Occasionally, this particular niche of the sports business gives rise to a dispute regarding the use of athlete images. Such a dispute is where the U.S. Soccer Federation ("USF") found itself after it authorized an advertisement for el Jimador tequila ("el Jimador") prior to the 2014 World Cup that featured several soccer players from the U.S. Men's National Team.
With the el Jimador advertisement scheduled to run, the U.S. National Soccer Team Players Association ("Players Association") called a foul, claiming that the USF had failed to seek the required prior approval from the Players Association and demanded arbitration under the existing Collective Bargaining Agreement ("CBA") between the parties. According to the Players Association, although the CBA did not contain any provision that expressly required the USF to obtain Players Association approval before allowing non-video advertisements or promotions featuring six (6) or more players ("Group Advertisements"), it did require prior approval for the use of player's likeness (and from 2001 until 2013, the USF had voluntarily submitted print creatives to the Players Association for review before authorizing Group Advertisements). In this case, when el Jimador proposed an advertisement featuring several soccer players, the Players Association voiced its disapproval, but the USF ignored them and, instead, issued a declaration asserting its contractual right to allow such Group Advertisements without prior approval.
In September 2014, in a surprise to some, the arbitrator issued an award in favor of the Players Association, ruling that the approval provisions for print advertisements submitted by sponsors in the CBA were ambiguous and that the USF's past practice of seeking prior approval for these advertisements created an implied requirement in the contract.
In response, the USF filed a complaint on December 10, 2014, in Illinois federal court contesting the arbitrator's ruling and claiming that the arbitrator exceeded his authority by relying on past approval practices instead of the express terms of the CBA. (United States Soccer Federation, Inc. v. United States National Soccer Team Players Association, No. 1:14-cv-09899 (N.D. Ill. filed Dec. 10, 2014)). In ruling again against the USF, the District Court stressed its "extremely limited authority" to review arbitration decisions. Though the court believed the arbitrator's interpretation may have been "unsound," it did not believe that was enough to overturn the award.
Not willing to concede the match, the USF dribbled the case upfield to the Seventh Circuit, where in September the appeals court overturned the arbitrator's decision and ruled in favor of the USF. In doing so, the Seventh Circuit found that the CBA was clear and unambiguous on the issue of approval for Group Advertisements (United States Soccer Federation, Inc. v. United States National Soccer Team Players Association, 2016 WL 5239838 (7th Cir. Sept. 22, 2016)). Though it noted that its power to review arbitration awards was indeed "limited," the appeals court found the arbitrator erred and exceeded the powers delegated to him by the USF and the Players Association in the CBA. According to the court, the contract was not silent at all on the issue, but instead explicitly stated that for Group Advertisements, the USF need only request, but not require, a sponsor to make a discretionary monetary contribution to a particular player pool.
As the appeals judge made clear, there is a "big difference" between misunderstanding and ignoring contractual language, and there was no possible interpretive route to the arbitrator's fancy footwork in the case.
So, in the end, after the Players Association scored big at the arbitrator and the district court, the USF roared back and scored the deciding goal in the Seventh Circuit, who reversed the lower court's ruling, vacated the arbitrator's award and enter judgment in favor of the USF.