Revisiting Fraser—The Need For The US To Mimic European Soccer’s Free Market System to Expand Soccer Within the Nation

The United States ranked first overall for power sports nations in the World Ranking of Countries in Elite Sport (“WRCES”) index, which provides a precise evaluation of nations in elite sports.[1] However, the United States struggles to keep up with its counterparties internationally when the scope focuses on soccer. It falls outside the top ten based on the population share that follows the sport and team strength.[2] The discrepancy is mainly attributable to the talent gap and difference in financial opportunities between Major League Soccer (“MLS”) and international leagues like the English Premier League (“EPL”).[3] For the United States to expand soccer’s popularity within the nation and catch up with its international colleagues, the First Circuit should revisit its decision in Fraser v. MLS and restructure the league as a free market system rather than a single entity.[4]

In 1995, the United States Soccer Federation (“USSF”) established the MLS as a limited liability company (“LLC”) under Delaware law.[5] The MLS’s structure is unique compared to European leagues such as the EPL—the MLS owns all of the teams making up the league, controls all intellectual property rights related to the league or any team, and controls player employment.[6] In contrast, European leagues employ a club-based system where teams operate independently, and owners can negotiate player salaries and control player employment directly.[7] Plaintiff-players’ main contention in Fraser centered around the MLS’s “sole responsibility for negotiating and entering into agreement with, and for compensating players.”[8] The players brought antitrust claims against the MLS, arguing that the MLS violated Sherman Act § 1 by agreeing not to compete for player services, § 2 of the Sherman Act by conspiring to monopolize with the USSF, the market for services of Division 1 professional soccer players, and Clayton Act § 7 by creating a monopoly through their control of MLS team assets to substantially lessen competition.[9]

In Copperweld, the Supreme Court held that a corporation and its wholly owned subsidiary comprise a single entity for purposes of § 1 of the Sherman Act.[10] The Copperweld decision paved the way for the District Court’s resolution of the § 1 and § 7 claims on summary judgment on the grounds that the MLS and its operators constituted a single entity incapable of conspiracy for § 1 purposes.[11] On appeal, the First Circuit erroneously failed to address the determination that the MLS and its operators constituted a single entity in light of the jury’s findings on the § 2 claim that the players failed to prove a relevant market.[12]

The Fraser Court was wrong to rely so heavily on Copperweld and interpret the single entity status of sports leagues as inconsistent with that of other circuits.[13] Copperweld focused on the “complete unity of interest” between a parent company and its subsidiary when treating the two as a single entity.[14] In failing to address the single entity determination, the First Circuit stated their belief that the MLS lacks complete unity of interest due to, like European team owners, operators’ independent hiring processes, covering out-of-pocket expenses, and retaining revenue from their team’s activities.[15]  Therefore, the First Circuit should revisit the Fraser decision to find that the MLS lacks a complete unity of interest and is not a single entity but rather a club-based system like its counterparties domestically (the NFL, NBA, MLB, and NHL) and internationally (the EPL, La Liga, Ligue 1).

Implementing a free market system similar to European leagues likely will increase soccer’s popularity within the United States. Although this may decrease competitive parity between teams without the financial means to pay competitive salaries, a free market system would increase players’ salaries and ability to move from club to club.[16] What likely follows is that top talents globally become incentivized to sign with an MLS club instead of a European club due to an offer of a competitive salary. For example, Inter Miami’s acquisition of Lionel Messi delivered an increase of 15.4 million followers to the club’s Instagram account, a projected revenue spike of approximately $150 million for 2024, and increased ticket sale prices by 515%.[17] However, the MLS enforces a salary cap to maintain a relatively competitive balance among teams, which is how Inter Miami landed Messi. This restraint still limits an MLS club’s ability to compete with European clubs nevertheless, because European teams enjoy the luxury of no salary cap and can fill their entire roster with players on salaries comparable to Messi’s contract with Inter Miami.[18] By following the lead of European leagues and implementing a free market system, more top talents, like Messi, likely will become open to MLS opportunities, further growing and legitimizing soccer’s presence within the United States. Therefore, the First Circuit should revisit Fraser and find that the MLS is not a single entity, consistent with the status of other sports leagues domestically and internationally.

Jonathan M. Green is a staff member of Fordham International Law Journal Volume XLVIII. 

[1] USA, Great Britain, and France lead World Ranking of Countries in Elite Sports 2023 Podium, AIPS Int’l Sports Press Ass’n (Feb. 1, 2024), https://www.aipsmedia.com/aips/pages/articles/2024/34985.html.

[2] Felix Richter, The Global Game of Football, Statista (May 24, 2024), https://www.statista.com/chart/14329/global-interest-in-football/; World Football / Soccer Rankings, The Power Rank, https://thepowerrank.com/world-football-soccer/ (last visited Jan. 8, 2025).

[3] The median MLS salary is about $600,000 compared to European leagues, where the average salary is €4.7 million.  See Cyrus Moulton, What Does Soccer Need to Break Through to Americans?, Northeastern Global News (Jul. 3, 2024), https://news.northeastern.edu/2024/07/03/why-is-pro-soccer-not-popular-in-the-us/#:~:text=And%20even%20when%20its%20dominant,already%20tried%20importing%20a%20superstar; see also Europe vs. North America: Player Wages, TIFOSY Capital & Advisory, https://www.tifosy.com/en/insights/europe-vs-north-america-player-wages-3432 (last visited Jan 8. 2025).

[4] See Fraser v. Major League Soccer, L.L.C., 284 F.3d 47, 59 (1st Cir. 2002) (declining to overturn the District Court’s finding that the MLS comprised a single entity).

[5] Id. at 53.

[6] Edward Mathias, Big League Perestroika? The Implications of Fraser v. Major League Soccer, 148 U. Pa. L. Rev. 203, 221 (1999).

[7] Mutonga Kamau, MLS vs. European Leagues: A Comparative Analysis, Vocal Media: CLEATS (Jan. 4, 2025) https://vocal.media/cleats/mls-vs-european-leagues.

[8] Fraser, 284 F.3d at 53

[9] Id. at 69 (“[i]f not for this combination of assets and purchase of stock, MLS Member Teams would compete with each other for players, like teams in all other major professional sports leagues in the United States.”); See 15 U.S.C.A. § 1 (Any contract, combination, or conspiracy in restraint of trade amongst multiple parties is declared illegal); see also 15 U.S.C.A § 2 (Every person monopolizing or attempting to monopolize, combining, or conspiring with any other person or persons, to monopolize any part of trade or commerce shall be deemed guilty in the discretion of the court); 15 U.S.C.A. § 18 (no person engaged in commerce or any activity affecting commerce shall acquire stock or assets whose effect may be substantially to lessen competition, or to tend to create a monopoly).

[10] See Copperweld Corp. v. Indep. Tube Corp., 467 U.S. 752, 771 (U.S. 1984).

[11] See Fraser v. Major League Soccer, L.L.C., 97 F.Supp. 2d 130, 139 (D. Mass. 2000).

[12] Fraser, 284 F.3d at 59.

[13] See, e.g., N. Am. Soccer League v. Nat’l Football League, 670 F.2d 1249, 1256 (2d Cir. 1982) (finding that competition for consumer dollars I between two single economic entities); Los Angeles Mem’l Coliseum Comm’n v. Nat’l Football League, 726 F.2d 1381, 1388 (9th Cir. 1984) (upholding that NFL clubs are separate business entities); Mackey v. Nat’l Football League, 543 F.2d 606, 619 (8th Cir. 1976) (holding that the NFL is a joint venture between the teams and the league).

[14] See Copperweld, 467 U.S. at 771 (“[T]he coordinated activity of a parent and its wholly owned subsidiary must be viewed as that of a single enterprise for purposes of § 1 of the Sherman Act.  A parent and its wholly owned subsidiary have a complete unity of interest. Their objectives are common, not disparate; their general corporate actions are guided or determined not by two separate corporate consciousnesses, but one.”)

[15] See Fraser, 284 F.3d at 57.

[16] Daniel S. MacMillan, Is MLS Inherently Anticompetitive? The Strange Single-Entity Structure of Major League Soccer in Order to Legitimize American Professional Soccer, 28 Marq. Sports L. Rev. 503, 520 (2018).

[17] Asli Pelit, The Summer of Messi: How the Goat Shifted Business in MLS, Sportico (Nov. 28, 2023), https://www.sportico.com/personalities/athletes/2023/lionel-messi-mls-summer-2023-1234747987/; Brian Bushard, The Messi Effect: Inter Miami Ticket Prices Jump 1,000% After Messi Joins MLS, Forbes (Jun. 7, 2023), https://www.forbes.com/sites/brianbushard/2023/06/07/the-messi-effect-inter-miami-ticket-prices-jump-1000-after-messi-reportedly-joins-mls/.

[18] There are no salary caps in European leagues.  See Kamau, supra note 3; Manchester City F.C. 2024-25 Payroll Table, Spotrac, https://www.spotrac.com/epl/manchester-city-fc/cap/_/year/2024 (last visited Jan. 10, 2025); Michele Kaufman, Messi’s Salary Tops 22 Other Entire MLS Payrolls.  Here’s the Full Inter Miami Salary List, Miami Herald (Oct. 24, 2024), https://www.miamiherald.com/sports/mls/inter-miami/article294455364.html.

This is a student blog post and in no way represents the views of the Fordham International Law Journal.