Lawsuit of Phenomenal Magnitude: FIFA under threat due to Diarra's verdict, accused of player injustice
Justice for Players Launches Class-Action Lawsuit Against Fifa and European Football Associations
A class-action lawsuit has been initiated by the Justice for Players (JfP) foundation, aiming to recover billions of euros in lost earnings for over 100,000 professional footballers who played for clubs in EU member states and the UK since 2002. The lawsuit, funded by litigation funder Deminor, targets FIFA and several national football associations, including those of Belgium, Denmark, France, Germany, and the Netherlands.
The lawsuit is a direct result of the European Court of Justice's ruling last year in the Lassana Diarra case, which found that certain FIFA regulations infringed EU competition law and workers' right to free movement. The unlawful regulations, according to JfP, resulted in footballers earning approximately eight percent less than they otherwise would have.
The JfP foundation is being advised by Jean-Louis Dupont, the lawyer behind the Diarra and Bosman rulings, and is represented by Netherlands-based firm Finch Dispute Resolution. The lawsuit is being filed under Dutch law (WAMCA – the Act on the Settlement of Mass Damages in Collective Action), chosen for its favourable legislation for large class actions.
The lawsuit alleges that FIFA's transfer regulations, in place since 2002, unlawfully restricted the free movement of professional footballers, causing them to earn less than they otherwise would have. The regulations were described as imposing a "no-poaching agreement," granting FIFA too much unilateral control over player transfers and contract terminations, directly impacting players' earnings.
According to a preliminary economic analysis by consulting firm Compass Lexecon, these FIFA restrictions cumulatively reduced players' earnings by about 8% throughout their careers. Given that the average professional football career spans roughly eight years, this reduction represents a significant financial loss for the affected players.
In response to the Diarra ruling, FIFA has stated that it will revise its worldwide transfer regulations. However, Daniel Gore, senior associate in the dispute resolution team at law firm Withers, stated that Fifa will find it difficult to put forward a robust defense to these claims in the face of the ECJ's decision in the Diarra case.
The Bosman ruling, which gave out-of-contract footballers freedom of movement for the first time, ushered in a new era of player power during the 1990s. This historical background provides additional context to the current issue, highlighting the ongoing struggle for fairness and justice in the football industry.
- The lawsuit, aimed at recovering billions of euros in lost earnings, has been initiated by the Justice for Players (JfP) foundation against FIFA and several national football associations.
- The lawsuit targets FIFA and national associations from Belgium, Denmark, France, Germany, and the Netherlands, under the Dutch law (WAMCA) due to its favourable legislation for large class actions.
- The unlawful regulations imposed by FIFA allegedly resulted in footballers earning approximately eight percent less than they otherwise would have.
- Consulting firm Compass Lexecon's preliminary economic analysis suggests that these FIFA restrictions cumulatively reduced players' earnings by about 8% throughout their careers.
- Despite FIFA's statement to revise its worldwide transfer regulations in response to the Diarra ruling, Daniel Gore, senior associate at law firm Withers, believes that FIFA may find it challenging to defend these claims in light of the ECJ's decision in the Diarra case.
- The current issue, marked by the JfP's lawsuit against FIFA, gains historical context from the Bosman ruling, which granted out-of-contract footballers freedom of movement and ushered in a new era of player power during the 1990s, thus highlighting the ongoing struggle for fairness and justice in the football industry.
