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Court may let FIFA-MasterCard dispute go to Swiss arbitrators

Court may let FIFA-MasterCard dispute go to Swiss arbitrators

A contract dispute over whether MasterCard or Visa sponsors the next two soccer World Cups might be decided or at least influenced by an arbitration panel in Switzerland, a U.S. federal appeals panel indicated on Wednesday.
The three-judge panel of the 2nd U.S. Circuit Court of Appeals reserved ruling on the case after hearing oral arguments. But two of three judges said the arbitration panel in Zurich might be entitled to decide some aspects of the dispute.
FIFA filed a lawsuit with the arbitration panel asking it to consider the dispute after U.S. District Judge Loretta Preska ruled last December that MasterCard International Inc. can sponsor the next two World Cups in 2010 and 2014. Preska ruled FIFA did not honor its MasterCard agreements when it awarded the rights to Visa International Inc.
Preska said FIFA misled MasterCard, America's second-largest credit card brand behind Visa, into believing it had an exclusive 90-day period in early 2005 to consider a sponsorship deal for the next two World Cups when FIFA was actually "simultaneously and aggressively" negotiating with Visa.
FIFA lawyer William M. Brodsky told the appeals panel on Wednesday that contracts between MasterCard and FIFA provide soccer's governing body with the right to arbitrate its disputes rather than have the courts decide them.
MasterCard has maintained that FIFA wants the case arbitrated to give it a second chance to go ahead with its Visa deal.
Judge Sonia Sotomayor said the arbitration panel should be permitted to decide which contract is valid. And Judge Ralph K. Winter agreed some of the issues in the dispute may have to be decided through arbitration.
One issue relevant to the case is whether FIFA should be bound by a contract it signed with MasterCard in 2005 or one that it declined to sign in March 2006.
Winter said it was a "huge problem" that MasterCard seemed unwilling to say whether it believed the second contract was in effect.
Pressured by Winter, MasterCard's lawyer, Martin S. Hyman, said the company believed the first contract it signed with FIFA was the only contract fully in effect. But Brodsky said FIFA believed both contracts called for disputes to be decided through arbitration.


Updated : 2021-03-09 19:27 GMT+08:00