The firm recently obtained a complete dismissal of an antitrust class action suit brought against its client FIFA (the Fédération Internationale de Football Association) in the United States District Court for the District of Nevada before The Hon. James C. Mahan.
FIFA hosts the World Cup—the world’s premiere soccer event—every four years, and in 2014, it hosted the World Cup in Brazil. Tickets for the 2014 World Cup matches, which were in high demand, were sold in two basic formats: standalone, “face-value” tickets, to attend a given match, and “hospitality packages,” which included a match ticket as well as amenities such as parking, lodging, food, beverages, and other services. Because hospitality packages include more services than a face-value ticket, they also cost more money—a fact that would strike most as unsurprising.
But in September 2015, two individuals—Vicki Palivos and George Kleanthis—filed a class action against FIFA and five other entities alleging that the sale of hospitality packages to the 2014 World Cup was the result of an international conspiracy in violation of the antitrust laws and civil RICO, both of which allow recovery of treble damages. At the heart of plaintiffs’ complaint was an allegation that FIFA and its co-defendants had tricked consumers, including Ms. Palivos and Mr. Kleanthis, into buying these relatively more-expensive hospitality packages instead of face-value tickets by (a) circumventing U.S. and Brazilian law, which plaintiffs alleged did not allow for the sale of tickets to be higher than the “face value” of individual match tickets, and (b) falsely claiming individual match tickets were sold out so that individuals would be forced to purchase more expensive hospitality packages. Given the number of hospitality packages sold in the United States, FIFA was facing a lawsuit that could potentially cost them hundreds of millions of dollars.
On behalf of FIFA, the firm quickly spotted a key flaw in plaintiffs’ action. From FIFA records, it appeared that neither plaintiff had actually purchased a hospitality package to the 2014 World Cup and thus had no standing to pursue the class action on behalf of themselves or others. Armed with this knowledge, the firm sought to resolve the lawsuit by informing plaintiffs’ counsel of the facts and requesting that plaintiffs withdraw the complaint so as to make time-consuming and costly motion practice unnecessary. Plaintiffs, however, refused, apparently in the hopes that they might capitalize on an unrelated criminal investigation into FIFA’s business practices to obtain an early settlement. (Quinn Emanuel also represents FIFA in the criminal investigation.)
This tactic was unsuccessful. Quinn Emanuel defended the case aggressively, moving to dismiss it with prejudice, on both the merits and for lack of personal jurisdiction. FIFA also moved for sanctions under Rule 11, characterizing the case as a strike suit that could not be pursued in federal court or indeed in any court.
In opposing the motion, plaintiffs attempted to convince the Court, by references to the criminal investigation of FIFA, that their suit should be permitted to proceed because FIFA must have done something wrong. Also, while the motions to dismiss were pending, plaintiffs attempted to serve no less than 201 document requests—in essence, a massive fishing expedition into FIFA’s business practices. Plaintiffs tried to amend their complaint after the motion to dismiss had been fully briefed, asserting entirely new theories of liability.
Quinn Emanuel was able to obtain a complete victory for FIFA. Plaintiffs’ requests to conduct document discovery and jurisdictional discovery were denied, and in July 2016—less than a year after the action was filed, Judge Mahan dismissed the class action complaint, agreeing with FIFA that because plaintiffs never bought hospitality packages, they lacked standing to bring the claims. The Court also denied plaintiffs leave to amend and entered judgment in favor of FIFA. Finally, although the Court did not award Rule 11 sanctions, it noted in its opinion dismissing the case that it was “amused” by plaintiffs’ attempts to keep their claims alive, describing their tactics as “questionable” and remarking that “a competent attorney would not have” behaved the way plaintiffs’ counsel did.