Antitrust Law Daily Wrap Up, ANTITRUST—E.D.N.Y.: NASL motion for retrial in suit against USSF and MLS denied, (May 7, 2025)

By Martin A. Steinberg, J.D.

On February 3, 2025, a jury rendered a verdict against the North American Soccer League in its antitrust dispute against the United States Soccer Federation and Major League Soccer.

There will be no new trial in the suit between a men’s professional soccer league and the governing bodies of professional soccer in the U.S., according to the federal district court in Brooklyn, New York. The North American Soccer League (NASL) sued the U.S. Soccer Federation and Major League Soccer (MLS), alleging that they conspired to exclude NASL from the markets for Division 1 and Division 2 men’s professional soccer leagues in the U.S. and Canada. After a three-week trial, the jury returned a verdict for the U.S. Soccer and MLS. NASL moved for a new trial, arguing that the jury instructions, verdict form, and evidentiary decisions before and during the trial contained many serious errors. The court denied the motion, finding that there were no clear errors that would require the court to set aside the verdict and conduct a new trial (North American Soccer League, LLC v. United States Soccer Federation, Inc., No. 1:17-cv-05495-HG (E.D.N.Y. May 6, 2025)).

NASL was founded as a men’s professional soccer league in 2009 after several USL (MLS’s minor-league affiliate) teams decided to break away from USL and form a separate league with D1 ambitions. In 2009, both NASL and USL were seeking D2 league sanctions. The Board ordered NASL and USL teams to play together in a joint USSF-run D2 league in 2010.

USSF is a non-profit private membership organization affiliated with FIFA, the international soccer body that runs the World Cup and other major tournaments through its regional affiliates. USSF asserts the authority to regulate and oversee professional soccer in this country through this affiliation. As the regional governing body for soccer in the United States, USSF designates leagues as Division I, II, or III by applying its Professional League Standards. The United States Olympic Committee also recognizes U.S. Soccer as the national governing body for soccer in the U.S. USSF’s members are professional soccer teams and leagues, including NASL, MLS, and United Soccer League (USL). MLS is a men’s professional soccer league formed in 1995. It has been the only U.S. Soccer-sanctioned D1 men’s league since U.S. Soccer’s formation.

Representatives from separate professional leagues serve on the U.S. Soccer Board of Directors (the Board) and other U.S. Soccer bodies, such as the Professional Council. The Board determines whether to sanction U.S. professional leagues in Divisions I through III (“D1,” D2,” and “D3”) based on Professional League Standards (“Standards” or “PLS”) originally adopted by USSF in 1995 with revisions adopted in 2014. The Standards set forth requirements for minimum stadium seating capacity, number of teams, time zone coverage, and other benchmarks for each Division. Divisional sanctioning by U.S. Soccer confers benefits such as access for the sanctioned league’s teams to prominent competitions and access to hiring world-class players. A D1 or D2 sanction is significant for a professional soccer league’s reputation and stature with fans, sponsors, and broadcasters.

U.S. Soccer member leagues must meet the applicable PLS or receive waivers to be sanctioned by U.S. Soccer as D1, D2, or D3 leagues. Since its adoption in 1995, the PLS has included a waiver procedure for leagues that do not meet one or more requirements. NASL has requested waivers each year.

Procedural history. Plaintiff initiated this action on September 19, 2017, alleging that USSF’s power to determine the requirements that leagues must meet to be part of Division I or II protected the monopoly position of its commercial business partner, MLS, in the relevant market for top-tier U.S. and Canada men’s professional soccer leagues, in violation of the Sherman Act. NASL also moved for a preliminary injunction to require U.S. Soccer to maintain its status as a Division 2 men’s professional soccer league. However, the court denied the preliminary injunction motion, concluding that the Plaintiff failed to show entitlement to relief clearly. On February 23, 2018, the Second Circuit affirmed that ruling, agreeing that Plaintiff could not demonstrate a clear likelihood of success on the merits. See NASL v. USSF, 883 F.3d 32, 34—35 (2d Cir. 2018) (NASL II). On March 16, 2018, Plaintiff filed its Amended Complaint.

After the parties filed summary judgment and Daubert motions in June 2021, the court granted summary judgment to Defendants on Plaintiff’s Count 1, which alleged that U.S. Soccer’s Professional League Standards (the “Standards”) themselves, in totality, violated Section 1.

A jury trial took place earlier this year. Plaintiff brought four claims to the jury: Conspiracy to Restrain Trade in Division 1 and Division 2 (Count 12); Conspiracy to Monopolize Division 1 and Division 2 (Count 2); Monopolization of Division 1 (Count 3); and Attempted Monopolization of Division 1 (Count 4). Counts 1 and 2 were brought against both Defendants; Counts 3 and 4 were brought against only MLS. The jury returned a complete verdict for the Defendants on February 3, 2025. Plaintiff then filed its motion for a new trial on March 3, 2025.

Relevant markets. The court found that he jury instructions and verdict sheet correctly applied the law in this case. For all counts related to Divisions 1 and 2, the jury was asked the threshold question of whether Plaintiff proved the existence of one or both of the relevant antitrust markets: (a) the market for each Division sanctions for men’s professional soccer leagues located in the U.S. and Canada, and (b) the market for team membership in each Division men’s professional soccer league located in the U.S. and Canada.

As an initial matter, Plaintiff’s central argument that there was no threshold relevant market requirement for any of its counts was waived. A party may not use a Rule 59 motion to advance a liability theory inconsistent with the one pursued at trial. Given that Plaintiff, Defendants, and the court agreed on the threshold relevant market requirement for each count, the court instructed the jury to find as much as possible. While the Plaintiff may regret having “endorsed the substance of the given charge,” that did not retroactively render that charge erroneous.

The verdict form given to the jury hewed closely to the Plaintiff’s proposed instructions, which reflected all four of its alleged markets. Additionally, Plaintiff’s claim of error relies on a faulty view of the law. According to Plaintiff, the relevant market has no meaning; the jury can look to any market and fill in a blank. Plaintiff, however, overreads U.S. Football League v. NFL, 842 F.2d 1335, 1363—67 (2d Cir. 1988), for the proposition that “a plaintiff can prevail where the jury finds anticompetitive harm in a relevant market that is different or broader than the one alleged by the plaintiff,” claiming that the Second Circuit upheld a supplemental jury instruction after the jury redefined the relevant market on the verdict sheet. However, the portion of the decision is dictum; the Second Circuit found a waiver of the objection to the jury charge and a purportedly ambiguous verdict. That decision does not stand for the broad understanding of verdict form flexibility claimed by the Plaintiff.

Section 1 claim. Plaintiff argued that no legal requirement exists to prove the existence of a relevant market for a Section 1 claim. Some commercial practices may be so obviously anticompetitive that no further inquiry into issues like market structure is needed. A classic example is fixing the naked price among competitors. In this case, the Second Circuit clearly explained that “[r]egulation of league sports is a textbook example of when the rule of reason applies.” NASL II, 883 F.3d at 41. Plaintiff’s claim challenging the Standards “in totality” did not survive summary judgment. And jury instructions were not the vehicle to revisit that decision.

The court also found that Plaintiff’s argument runs afoul of the law of the case doctrine. That discretionary doctrine provides that when a court has ruled on an issue, that decision should generally be adhered to by that court in subsequent stages in the same case. And here, there is a particularly compelling case for its application, as every judge to consider this issue, both in this court and at the Court of Appeals, rejected a per se or quick look framework and instead employed rule of reason analysis to Plaintiff’s Section 1 claim.

Proof of a relevant market was required under the rule of reason. While some “horizontal restraints,” or those “imposed by agreement between competitors,” are “unreasonable per se,” the Supreme Court has made clear that restraints that are not unreasonable per se are judged under the rule of reason. See Ohio v. Am. Express Co., 585 U.S. 529, 541 (2018).

Section 2 conspiracy claim. The Plaintiff also argued that the court erred in requiring the jury to find a relevant market for its conspiracy to monopolize claim under Section 2. However, Plaintiff’s own initial proposed instruction stated that the first element of the conspiracy to monopolize claim is that USSF and MLS entered into an agreement or mutual understanding for MLS to obtain or maintain monopoly power in one or more relevant markets and that Defendants had the specific intent that MLS would obtain or maintain monopoly power in the relevant markets. In the second round of proposed jury instructions, Plaintiff’s description of this count also contained relevant market requirements.

On a verdict sheet, market identification takes place through relevant market analysis. The Second Circuit has stated that the relevant market analysis is essential for assessing the potential harm to competition from the defendants’ alleged misconduct and that this is equally applicable to claims made under Section Two because without a definition of that market there is no way to measure the defendant’s ability to lessen or destroy competition. Concord Assocs., L.P. v. Ent. Props. Tr., 817 F.3d 46, 53 (2d Cir. 2016).

The Plaintiff made the same argument regarding the lack of need to prove a relevant market with respect to its monopolization and attempted monopolization claims. As before, that argument was absent in Plaintiff’s initial proposed instructions; indeed, concerning monopolization, Plaintiff and Defendants jointly proposed instructing the jury: “You were previously instructed on how to determine whether the markets alleged by NASL are relevant antitrust markets. Those same instructions apply to this monopolization Count.” Similarly, concerning attempted monopolization, Plaintiff asked the court to instruct the jury that “the second element of an attempt to monopolize claims requires NASL to prove, through a preponderance of the evidence, that MLS had a specific intent to monopolize one of the relevant markets.”

Plaintiff attempted to “cover the waterfront” by proposing four relevant markets, but the jury concluded that Plaintiff failed to prove any of them. The court refused to send this case back to a jury based on freeform ideas about anticompetitive behavior, not just disconnected from the Plaintiff’s market definitions, but from any market definition at all.

Evidentiary rulings. Plaintiff argued that the court excluded evidence regarding downstream markets, but permitted Defendants to attack Plaintiff’s relevant markets and confuse the jury by presenting evidence and arguments about downstream markets. On its evidentiary challenges, Plaintiff faces an additional hurdle on the already steep climb to relief under Rule 59. As the Second Circuit explained, an erroneous evidentiary ruling warrants a new trial only when a substantial party's right is affected, as when a jury’s judgment would be swayed materially by the error. Restivo v. Hessemann, 846 F.3d 547, 573 (2d Cir. 2017). But here, there was no error, much less that kind of serious error that would require a new trial. Yet, at the motion in limine stage, Plaintiff made clear that it did not seek to preclude Defendants from bringing in evidence concerning downstream markets “in assessing the bounds of the at-issue relevant market of team owners.” Similarly, Plaintiff’s initial proposed jury instruction permitted the jury to “consider how people in the industry and the public at large view the products; whether the products have the same or similar characteristics or uses; whether the products have similar prices; whether the products are sold to similar customers; and whether they are distributed and sold by the same kinds of sellers.”

Additionally, Plaintiff’s assertion about what evidence came in was misleading. For example, Plaintiff complained that the court allowed Defendants’ fact witnesses to testify about downstream markets but did not allow Plaintiff’s expert to testify about the same. However, Plaintiff did not object in the two cited instances of Defendants’ fact witnesses providing such testimony. And the court allowed Plaintiff’s expert to testify about the defense's testimony concerning market definition.

The Plaintiff also complained about U.S. Soccer’s closing argument, where defense counsel argued at length about relevant markets. First, Plaintiff used the wrong framework for this challenge, which sounded in misconduct, not evidence. A new trial may be appropriate where counsel’s conduct created undue prejudice or passion, which piqued the jury's sympathy. But there was no misconduct here, and definitely not serious misconduct requiring a new trial.

Inflammatory and prejudicial evidence. Plaintiff’s subsequent claim of error is that the court improperly admitted two categories of evidence concerning Rocco Commisso’s tweets and litigation funding, as well as Traffic Sports. The court noted that, even if these arguments had merit, they would not be the basis for a new trial. That is because Plaintiff never links them to the jury’s verdict, which related exclusively to Plaintiff’s failure to prove relevant markets. It is not enough for Plaintiff to claim or prove that the admission of specific evidence unfairly prejudiced it; instead, it must show that it was likely that the factfinder’s judgment was swayed by the error in some material respect. The Plaintiff had not tried to do that in its Motion or Reply. And there were no errors in any case.

Rocco Commisso was the NASL team owner and chairman of the NASL’s board. After NASL was denied its D2 sanction, he tweeted about U.S. Soccer and MLS anonymously. Before trial, Plaintiff moved to exclude those tweets. The Court denied the motion, explaining that although the tweets might be inflammatory, they were “significantly probative” regarding Mr. Commisso’s bias and credibility under Rule 403. The same is true of Plaintiff’s argument concerning Commisso’s funding of this litigation. It's an attempt to rehash a settled issue.

The Plaintiff also argues that the court should not have admitted evidence related to Traffic Sports and Aaron Davidson. Traffic was an international soccer organization “closely affiliated” with NASL. Davidson was a Traffic executive who served as chairman of the Plaintiff’s Board of Governors, and both were later indicted and pled guilty to fraud. The Court held that it would not “wholesale exclude evidence or testimony relating to the indictments and convictions of Traffic and Davidson.” Still, it cautioned that Defendants should not “belabor” these issues. Plaintiff presented no compelling argument displacing the court’s prior Rule 403 balancing with respect to evidence concerning NASL and Traffic. Furthermore, it failed to identify an error, much less a serious one, with how this evidence was presented. That is not surprising, since the court enforced careful guardrails around the presentation of this evidence.

Other evidence. Plaintiff concluded by listing various “other evidentiary errors that had serious impacts” and “should be corrected upon retrial.” It was unclear to the court what the purpose of this section is within a Rule 59(a) motion, as Plaintiff contended only that one “serious error” concerning one branch of one expert’s testimony warranted retrial. In any case, even if these arguments were meritorious, they would not lead to that relief because they have no relationship to the jury’s verdict, which concerned only relevant markets.

Rule 50(a) motion. Defendants argue that, even if the court agreed that a new trial was warranted here, it should deny such relief because it could have properly granted Defendants’ Rule 50(a) motion based on failure to prove conspiracy or harm to competition. Because the court found no basis to order a new trial, it declined to reach this argument.

The Case is No. 1:17-cv-05495-HG.

Judge: Gonzalez, H.

Attorneys: Adam Dale (Winston & Strawn LLP) for North American Soccer League, LLC. Aaron Chiu (Latham & Watkins LLP) for U.S. Soccer Federation, Inc.

Companies: North American Soccer League, LLC; U.S. Soccer Federation, Inc.

Cases: Antitrust NewYorkNews