The move many thought was coming finally happened this week, as the City of Columbus and State of Ohio filed suit against Precourt Sports Ventures and Major League Soccer. The goal: Prevent the Columbus Crew from moving to Austin, at least without complying with local laws in Ohio. You can read a copy of the complaint here. The statute at issue: Revised Code 9.67, also known as “the Art Modell law.” The statute is very short (which may be an issue going forward, but we’ll get into that at a later date), so I’ll post it here.
That’s it. The statute appears to be the first of its kind in the nation, though the City of Seattle, in the wake of the Seattle SuperSonics move to Oklahoma City, has I-91 on the books. But that law isn’t the same. The Ohio law was passed in aftermath of Art Modell leaving the city of Cleveland with his NFL team for Baltimore. The move was completed in February 1996, with the aforementioned law going into effect in June of that year (see, politicians can work quickly when they want to).
With that, there are a few things people should keep in mind.
1) Anyone who tells you they know for certain what the court is going to do at this point doesn’t know what they’re talking about.
Michael McCann has a good primer for the uninitiated on the lawsuit. And the key thing I wanted to pick out is that this type of law hasn’t been tested. Anywhere. As such, as a matter of first impression, we have no precedent to look at. Which is interesting for us following the case, but it makes it EXTREMELY difficult to predict an outcome.
You can contrast that to the ruling on the NASL’s request for an injunction, where it was reasonable to predict the outcome based on precedent and applying the facts to the law. There is no direct precedent in this matter, such that making a prediction based on prior law in this area is basically impossible. There isn’t even anything from other jurisdictions (“persuasive authority”) really to guide the Court’s decision here as it pertains to the statue. And persuasive authority is just that: persuasive. Doesn’t mean this court would have to follow it. As such, we’re going to have to wait to see what the legal arguments are from the parties.
2) We don’t know what arguments PSV/MLS will use to fight this matter:
This case isn’t as simple as, “PSV/MLS didn’t comply with the statute, and therefore they can’t move.” Two things here: First the timeline for compliance arguably hasn’t passed. Depending on how MLS calculates their “year,” we may not even be at the point where they’ve technically done anything in violation of the statute.
More importantly, PSV/MLS is likely to say that this statute doesn’t even *apply* to them. I previously called the PSV/MLS statement in response to this suit worthless, and it basically was. But there was one hint of their future strategy:
There is the hint. They might not even bother trying to comply with the statute. It’s much more likely to argue that the law as written either doesn’t apply, or has some other fatal legal defect such that it never could. Now, whether that takes the form of a dormant commerce clause challenge, or on vagueness/overbroad grounds, we do not yet know. It could be an even more obscure technical argument. At this point, it’s an open question, which is why I say to be wary of people predicting an particular outcome. MLS/PSV hasn’t even filed an Answer to the complaint. Speaking of which…
3) Unlike the legal arguments to come, the procedure in the case will be pretty straight forward.
Not much consolation to #SaveTheCrew, but at least we’ll see a relatively straight forward process leading up to trial. Todd put together a nice Twitter thread, but I figured I’d follow up in this forum.
Now that the complaint has been filed and (presumably) served, MLS/PSV have 28 days to respond. That puts their answer date at the beginning of April, 2018. After the Answer is filed, the real fireworks will be begin (Edit to add: The timing of when the Answer is filed is somewhat dependent on the course of action that PSV/MLS takes. They’d like file a motion to dismiss prior to filing an Answer, but we don’t know yet.). It is extremely important to note, that at this time THERE IS NOTHING PREVENTING MLS/PSV FROM MOVING THE TEAM.
If the City/State wants to prevent that move in advance of 2019, they MUST file a preliminary injunction to prevent the move. If you’ve followed me before, you’re probably well aware of the fight regarding preliminary injunctions as it relates to the NASL v. USSF lawsuit. The same issues apply here basically: Columbus must show that they are more likely than not to prevail on the ultimate issues in the case to secure the injunction (prohibitory). It’s basically a 51/49 weighted standard, though that is a crude measurement to be sure.
I should also note that I’m not particularly persuaded by the notion that PSV/MLS will prevail on a motion to dismiss because this matter is premature (ripeness). Given the overt lobbying PSV has done in Austin, and the stated desire to move there for the 2019 season, a good case could be made that this move is essentially inevitable, and in the context of the six-month notice requirement, it would be silly to require the plaintiffs to wait until June to file this case. Or, even if PSV/MLS argue the statute doesn’t apply, the fact they’re planning to move in 2019 still means the plaintiffs would overcome any ripeness issues.
What gets a bit tricky from here is the timing. PSV/MLS will likely file a motion to dismiss, or a summary judgment. That timeline could essentially match the motion for the injunction, though my guess is that the injunction would be argued first, as that would guide whether the PSV/MLS motions would prevail. Once those matters are sorted out, and if we still have a case at that point, then the parties would come together to outline the discovery process.
4) A journey of discovery
So this is going to be an interesting issue. PSV/MLS have made a big showing of how allegedly awful Columbus is in supporting the Crew (“Business Metrics”), but…is that at all relevant in this suit? It seems to me the issues are, 1) Compliance with local laws, to the extent they are valid and apply, and 2) Compliance with any relevant contracts.
Unless the contracts PSV/MLS hold with local municipalities have some provisions dealing with “business metrics,” such as attendance thresholds, season ticket minimums or sponsorship commitments, what does “business metrics” have at all to do with the case? It seems like just more PR fluff from PSV/MLS.
If that’s the case, the plaintiffs may not get a look at those books, as an argument could be made they’re not probative of anything in this suit. Now cutting against that is an argument that PSV/MLS opened the door to a look at the finances by spouting off, and it could be relevant if the statute is upheld in the context conducting a valuation to find a local buyer. But don’t assume that PSV/MLS will be forced to completely open the discovery vault.
From there, if the case is still ongoing, we move towards the trial, which at this time is set for March 2019. From the plaintiffs’ perspective, obtaining the preliminary injunction is essential, since it would prohibit the move pending the trial. Getting the team back once they’ve left is an extremely difficult proposition. Additionally, obtaining the injunction would send a message to PSV/MLS that at least on the initial presentation of the case, that they are likely to lose.
Failure to obtain the injunction while surviving the motion to dismiss could mean this is something of zombie case, especially if PSV/MLS end up leaving as the trial date arrives. Likely, that would turn this case into a matter of financial recoupment. Which is something, but likely a pyrrhic victory for #SaveTheCrew fans.