Yonan v. United States Soccer Federation, Inc. et al
Filing
60
MEMORANDUM Opinion and Order Signed by the Honorable Virginia M. Kendall on 6/22/2011:Mailed notice(tlp,)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
MARCEL YONAN,
Plaintiff,
v.
UNITED STATES SOCCER FEDERATION,
INC.
Defendant.
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Case No. 09 C 4280
Judge Virginia M. Kendall
MEMORANDUM OPINION AND ORDER
Plaintiff Marcel Yonan (“Yonan”) is a soccer referee and lawyer. In 2007, defendant United
States Soccer Federation, Inc. (“the Federation”) told Yonan, then 50 years old, that he would not
be assigned to work Major League Soccer (“MLS”) games. He sued, alleging age discrimination
in violation of the Age Discrimination in Employment Act (“ADEA”) (29 U.S.C. § 621 et seq.) and
retaliation. The Federation moved for summary judgment (Doc. 52), asserting that Yonan is an
independent contractor not protected by the ADEA. According to the Federation, even if Yonan was
an employee, Yonan cannot establish his ADEA and retaliation claims. For the reasons below, the
Court does not reach the issue of whether the Federation fired Yonan because of his age because it
finds Yonan is not an employee of the Federation and not protected by the ADEA. Consequently,
the Federation is entitled to summary judgment.
I.
MATERIAL UNDISPUTED FACTS1
A.
The Federation and Soccer Refereeing
The Federation is the statutory body that governs soccer in the United States. (Yonan 56.1
Resp. ¶ 3; Yonan Dep. 31.)2 The Federation registers, trains and certifies referees to officiate in
Federation games, which include national and international games as well as games for youth and
professional leagues affiliated with the Federation. (Yonan 56.1 Resp. ¶¶ 4, 22.) Those
professional leagues include the United Soccer League (“USL”) and MLS. (Id.) Referees who want
to officiate Federation-affiliated games must register with the Federation each year and pay a
registration fee. (Id. ¶ 5.) Referees are certified at different grade levels depending on their ability
and experience. (Id. ¶ 6.) To maintain certification as a national referee, a referee must fulfill certain
annual requirements including a physical endurance test and a written test on the International
Federation of Association Football’s (“FIFA”) Laws of the Game. (Id. ¶¶ 18-19.) National referees
are invited to an annual camp to complete these tests. (Id. ¶ 19.) Provided that the referee passes
the tests, individual test scores do not factor into referee assignment decisions for particular games.
(Id. ¶ 20.)
1
Yonan did not respond properly to the Federation’s Local Rule 56.1 statement of material undisputed facts,
choosing to put extra facts in his responses to the Federation’s facts. Yonan should have put those extra facts in a
separate statement of additional facts so that the Federation could respond to them with its reply. See L.R.
56.1(b)(3)(C) (requiring “a statement, consisting of short numbered paragraphs, of any additional facts that require
the denial of summary judgment, including references to the affidavits, parts of the record, and other supporting
materials relied upon.”) The Federation urges the Court to strike these additional facts and only accept the portions
of Yonan’s responses that respond to the Federation’s facts. Formal striking is unnecessary - the record is largely
undisputed on the employee vs. independent contractor issue and the Court has ignored those additional facts where
Yonan relies on them. See Cracco v. Vitran Express, Inc., 559 F.3d 625, 632 (7th Cir. 2009) (finding “[b]ecause of
the important function local rules like Rule 56.1 serve in organizing the evidence and identifying disputed facts, we
have consistently upheld the district court’s discretion to require strict compliance with those rules.”)
2
Though Yonan denied the details of the Federation’s statement on this point, he testified at his deposition
that the Federation is “the statutory body which governs the sport of soccer in the United States.” (See Doc. 55-1,
Yonan Dep. 31.)
2
Federation-registered referees are free to accept or decline the Federation’s assignments for
any reason. (Id. ¶ 25.) They also can officiate games not affiliated with the USSF, such as college
and high school games. (Id. ¶ 27.) Almost all Federation-registered referees who work MLS games
also work college games without penalty from the Federation. (Id.) When they work college games,
the home team pays the referee his or her fees and expenses. (Id.) Referees who want to officiate
college games must register with, and be certified by, a separate organization called NISOA. (Id.
¶ 28.) The Federation does not provide any offices or facilities to referees - their “workplace” which
is the playing fields, which is generally not owned by the Federation. (Id. ¶ 53.).
During the time Yonan was a referee, before most professional and international games, a
Federation referee “assessor” would contact him to provide his perspective on the teams and players.
(Id. ¶ 47.) Those discussions were for the benefit of the referees and designed to enhance their
performance during the game. (Id. ¶ 48.) MLS also hosted conference calls involving Federation
officials to assist referees in officiating MLS games, to ensure that referees were applying the Laws
of the Game consistently, and to enhance MLS’s credibility. (Id. ¶¶ 49-50.) In addition, MLS
hosted a meeting for referees during its All-Star break. (Id. ¶ 51.) MLS published a set of
guidelines for referees working MLS games that set out details like arrival times, jersey colors,
expense reports, and the forms that needed to be completed post-game. (Id. ¶ 52.) MLS required
that the referee’s uniform contrast with the colors of the jerseys worn by the teams. (Id. ¶ 56; Yonan
Dep. 151.) For other Federation-affiliated games, the referee decided what color uniform to wear,
often after packing several uniforms and selecting one based on the colors used by the teams.
(Yonan 56.1 Resp. ¶ 57.) Yonan asserts he had to wear a Federation blazer and tie (that he
purchased) while traveling to professional games, but admitted he did not always wear the special
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clothing and that he was unaware of any referee who was penalized for not doing so. (Id. ¶¶ 58-59.)
Sportswear companies, not the Federation, gave Yonan uniforms for free. (Id. ¶ 54.)
Yonan was the “head referee” most of the time. (Id. ¶ 60.) Under the Laws of the Game,
in place for all professional matches, the head referee has “full authority to enforce the Laws of the
Game in connection with the match to which he has been appointed.” (Id. ¶ 61.) The head referee
has final authority over control of the match, ensuring appropriate equipment and attire is used,
timing, and disciplinary action against players and coaches. (Id. ¶ 62.) Being a good referee
requires a great deal of skill and natural ability to manage assistant referees, players and coaches in
a fast-moving environment. (Id. ¶ 62.)
B.
Yonan’s Refereeing History
Yonan first registered with the Federation in 1982 or 1983 and rose to the rank of “national
referee” in 1992, which then allowed him to work professional games. (Id. ¶¶ 6-7.) On his 2007
registration form, he acknowledged that he understood that registering with the Federation “does not
create an employment contract or relationship with [the Federation].” (Id. ¶ 7.)
Since first
registering with the Federation, Yonan has refereed college games not affiliated with the Federation.
(Id. ¶¶ 8, 26.)3 The only Federation-affiliated professional leagues that Yonan has refereed were in
the MLS and the USL. (Id. ¶ 33.) When Yonan worked those games, the leagues, not the
Federation, compensated him. (Id. ¶¶ 34-35.) Specifically, either MLS or USL would cut a check
to Yonan and issue him an IRS Form 1099 to report the income for tax purposes. (Id.) The leagues
also paid Yonan’s expenses and reimbursed him for those expenses. (Id. ¶ 36.) Yonan also refereed
3
The testimony cited by Yonan to support his statement that college games he worked were affiliated with
the Federation does not support that point. (See Yonan Dep. 38-39.) Later, he admits that the Federation does not
assign referees for games not affiliated with the Federation, “such as intercollegiate games.” (Yonan 56.1 Resp. ¶
26; see also Yonan Dep. 83 (“college games are not assigned by the [Federation].”).)
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U.S. Open Cup games between the mid-1980s and 2006. (Id. ¶ 40.) Generally, the home team of
those games paid Yonan and sent him a Form 1099. (Id.) The Federation paid Yonan to referee the
occasional “regional game,” armed forces game, or international game involving the U.S. national
team when sponsored by the Federation. (Id. ¶¶ 34-35.) Referees for international games involving
two foreign national teams or an international club team like Manchester United were paid by
someone other than the Federation. (Id. ¶ 41.) In early 2007, the Federation told Yonan that he
would no longer be assigned to referee MLS games. (Id. ¶ 66.)
C.
Yonan’s Financial and Tax Records
In addition to being a soccer referee, Yonan is an attorney operating as a solo practitioner.
(Id. ¶ 9.) He received the majority of his annual compensation from his legal practice, and he
generally received less than $15,000 from refereeing. (Id. ¶ 45.) In his 2003-2007 tax returns, he
lists his profession as a combination of “legal services” and “soccer referee” and represented that
he was a self-employed “sole proprietor.” (Id. ¶ 10.) Yonan confirmed that the representations he
made on his tax returns were accurate. (Id., Yonan Dep. 95-96.) Yonan has no record of ever
receiving an IRS Form W-2 or 1099 from the Federation, and has never listed the Federation as an
employer on his tax returns. (Yonan 56.1 Resp. ¶ 11.) Similarly, he listed himself as self-employed
on mortgage and life insurance applications. (Id. ¶ 12.) The Federation gave Yonan liability
insurance coverage while he refereed Federation games, but did not give him a general health
insurance policy or any sick-pay, vacation or other benefits. (Id. ¶ 11, Yonan Dep. 141-42.)
II.
STANDARD OF REVIEW
Summary judgment is proper when “the pleadings, the discovery and disclosuire materials
on file, and any affidavits show that there is no genuine issue as to any material fact and that the
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moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c)(2). In determining
whether a genuine issue of fact exists, the Court must view the evidence and draw all reasonable
inferences in favor of the party opposing the motion. See Bennington v. Caterpillar Inc., 275 F.3d
654, 658 (7th Cir. 2001); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
However, the Court will “limit its analysis of the facts on summary judgment to evidence that is
properly identified and supported in the parties’ [Local Rule 56.1] statement.” Bordelon v. Chicago
Sch. Reform Bd. of Trustees, 233 F.3d 524, 529 (7th Cir. 2000).
III.
DISCUSSION
A.
Employees v. Independent Contractors: the “Economic Realities” Test
The ADEA prohibits “an employer . . . [from] failing or refusing to hire or to discharge any
individual . . . because of such individual's age.” 29 U.S.C. § 623(a)(1). The ADEA applies to
employees but not to independent contractors. See E.E.O.C. v. Fort Knox School Corp., 154 F.3d
744, 746 (7th Cir. 1998). In determining whether an individual is an employee or an independent
contractor under the ADEA, the Court applies a five factor “economic realities test” inspired by
agency principles. See id. at 747; Alexander v. Rush N. Shore Med. Ctr., 101 F.3d 487, 492 (7th Cir.
1996). The factors are:
1.
the extent of the employer’s control and supervision over the
worker, including directions on scheduling and performance
of work;
2.
the kind of occupation and nature of skill required, including
whether skills are obtained in the work place;
3.
responsibility for the costs of operation, such as equipment,
supplies, fees, licenses, workplace, and maintenance
operations;
4.
method and form of payment and benefits; and
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5.
length of job commitment and/or expectations.
Fort Knox, 154 F.3d at 746. Though the Court examines all five factors, “the employer’s right to
control is the most important when determining whether an individual is an employee or an
independent contractor.” Id. (quoting Knight v. United Farm Bureau Mut. Ins. Co., 950 F.2d 377,
378-79 (7th Cir. 1991)). “The ultimate question of whether an individual is an employee or an
independent contractor is a legal conclusion which involves an application of law to facts.” Fort
Knox, 154 F.3d at 746 (internal quotation and citation omitted.)
B.
Yonan Was an Independent Contractor
Because they implicate several of the five factors, it is important to discuss at the outset
Yonan’s unequivocal admissions that are entirely inconsistent with the position he has taken in this
suit, namely, that he is an employee of the Federation. In August 2006, just six months before the
Federation told him he would not be refereeing any more MLS games, Yonan told the Federation
he understood that his registration did not create an “employment relationship” with the Federation.
(See Doc. 51-1 at 55.) Perhaps even more importantly, under the risk of substantial criminal and
civil penalties if he lied on his tax returns, he told the IRS every year he was “self-employed”
operating as a “sole proprietor,” and never listed the Federation as his employer. He said the same
in a mortgage application, where any knowing misrepresentations would also subject him to criminal
liability. See 18 U.S.C. § 1014. It is difficult, if not impossible, to reconcile these statements with
his current position that he was an employee of the Federation. In any event, the five factors weigh
in favor of finding that Yonan was an independent contractor, not an employee covered by the
ADEA.
1.
Control and Supervision
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Generally, “if an employer has the right to control and direct the work of an individual, not
only as to the result to be achieved, but also as to details by which the result is achieved, an
employer/employee relationship is likely to exist.” Alexander, 101 F.3d at 493 (quoting Ost v. W.
Suburban Travelers Limousine, Inc., 88 F.3d 435, 439 (7th Cir 1996)). The Court must be careful
to distinguish between “control[ling] the conduct of another party contracting party by setting out
in detail his obligations” consistent with the freedom of contract, on the one hand, and “the
discretionary control an employer daily exercises over its employee’s conduct” on the other. North
Knox, 154 F.3d at 748.
Yonan asserts that the Federation “closely supervised” his performance at each soccer game
he officiated by giving him an assessor, discussing his performance, and controlling what clothes
he wore while on the field and traveling. Putting aside that the Federation did not, for the most part,
control what clothes he wore, the Federation did not supervise Yonan, but rather evaluated his
performance after matches. That the Federation evaluated Yonan as a referee does not mean that he
was an employee. There is no question that parties retaining independent contractors may judge the
performance of those contractors to determine if the contractual relationship should continue. See
North Knox, 154 F.3d at 749 (“It would be odd for someone not to take past performance into
account when deciding whether to enter into a new contract.”)
It is undisputed that the Federation did not control the way Yonan refereed his games. He
had full discretion and authority, under the Laws of the Game, to call the game as he saw fit. See
Hojnacki v. Klein-Acosta, 285 F.3d 544, 551 (7th Cir. 2002) (finding a doctor was not an employee
because she had full discretion as to how to treat her patients); Ost, 88 F.3d at 439 (noting that
limousine drivers could take any route they choose). In a similar vein, subjecting Yonan to
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qualification standards and procedures like the Federation’s registration and training requirements
does not create an employer/employee relationship. See Hojnacki, 285 F.3d at 551-52 (finding no
employee relationship even though the purported employer required training, participation in quality
improvement meetings, and set the hours of the workday); Ost, 88 F.3d at 438 (constraints like
calling in and out, setting rates, and requiring vehicles to be available for service at specific times
“do not . . . establish an employer-employee relationship because the details concerning performance
of the work” was decided by the driver); Alexander, 101 F.3d at 493 (finding that defendant’s
requirement of “on call” status and creating assignments did not make a doctor an employee).
Yonan’s relationship with the Federation, as the assignor of matches, is similar to the
relationship between limousine drivers and their dispatcher that the Seventh Circuit found was not
an employer-employee relationship in Ost. Ost, 88 F.3d at 439. In that case, the drivers were free
to work whatever days they wanted (as was Yonan), and could turn down any assignments from the
dispatching company (as could Yonan). Id. at 438. Just as Yonan could referee non-Federation
affiliated matches, the Ost drivers could accept assignments from other dispatching companies. Id.
The court found “[e]ach of these facts indicates that the manner in which the drivers performed their
services [for the dispatcher] was primarily within their own control.” Id. In short, the Federation
did not have the degree of control and supervision over Yonan that would suggest Yonan was an
employee.
2.
Occupation and Skill
A position that requires special skills and independent judgment weights in favor of
independent contractor status. See Alexander, 101 F.3d at 493. Unskilled work, on the other hand,
suggests an employment relationship. See id.; see also Jones v. Seko Messenger, Inc., 955 F. Supp.
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931, 933 (N.D. Ill.1997). Here, it is undisputed that soccer refereeing, especially at the professional
and international level, requires “a great deal of skill and natural ability.” Yonan asserts that it was
the Federation’s training that made him a top referee, and that suggests he was an employee.
Though substantial training supports an employment inference, that inference is dulled significantly
or negated when the putative employer’s activity is the result of a statutory requirement, not the
employer’s choice. See e.g., North Knox, 154 F.3d at 748 (finding state regulations giving the
school district certain oversight of bus drivers did not demonstrate control of the drivers). As the
Federation points out, in the Ted Stevens Olympic and Amateur Sports Act, Congress tasked the
Federation with “develop[ing] interest and participation [in soccer] throughout the United States.”
36 U.S.C. § 220524. As the National Governing Body for soccer, the Federation “establishes the
national goals for soccer [and] is the coordinating body for amateur soccer in the United States.”
See ChampionsWorld LLC v. U.S. Soccer Fed., Inc., 726 F.Supp.2d 961, 966 (N.D. Ill. 2010)
(Leinenweber, J.)4 The Federation’s power over amateur soccer is “monolithic.” Id. (citing
Behagen v. Amateur Basketball Ass’n, 884 F.2d 524, 529 (10th Cir. 1988)). This power necessarily
includes development of skilled referees. In other words, it is doubtful that Congress intended the
Federation to neglect entirely the development of referees when it told the Federation to develop
“interest and participation” in soccer. This factor also weighs against an employer-employee
relationship.
3.
Responsibility for Cost of Operation
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ChampionsWorld concerned the question of whether the Federation has the same level of control over
professional soccer that it does over amateur soccer. Even though Yonan was primarily a professional referee late in
his career, the issue of whether the Federation has control over professional soccer does not change the Court’s
analysis as to why the Federation trained referees for the purposes of the North Knox analysis.
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Under this factor, the Court asks who paid for Yonan’s equipment, supplies and workplace.
See Alexander, 101 F.3d at 492; Sulkin v. Chicago Transit Auth., No. 99 C 8808, 2000 WL 1508241,
at *6 (N.D. Ill. Oct. 10, 2000). Though the parties dispute exactly who paid for Yonan’s uniforms,
it is undisputed that the Federation did not pay for them. Yonan bought his own shoes, whistles and
cards, and he paid his own registration fee. The Federation only paid for Yonan’s travel expenses
when he refereed Federation-sponsored games. The individual leagues or one of the teams paid
them otherwise. This factor also weighs in favor of Yonan being an independent contractor.
4.
Method and Form of Payment and Benefits
The fourth factor, how Yonan received his pay and benefits, strongly demonstrates he was
an independent contractor, not an employee. He was not paid by the Federation, except for
individual games sponsored by the Federation. Rather, he was paid by the leagues and teams
running the games he worked, and compensated on a per-game basis. See Ost, 88 F.3d at 438 (noting
that the drivers were paid by passengers, not the dispatching company); Fort Knox, 154 F.3d at 750
(finding per-mile compensation for school bus companies supported independent contractor status
for the drivers). Again, he treated himself like an independent contractor for tax purposes. See id.
(alleged employees treated themselves as sole proprietors on their tax returns indicating independent
contractor status). The teams and leagues that paid him took the same tax position, issuing him
Form 1099s consistent with independent contractor status, not W-2s, which would be consistent with
employment. See id.
Yonan offers Worth v. Tyer, 276 F.3d 249 (7th Cir. 2001) for the proposition that the Seventh
Circuit has found employment relationships even when the plaintiff’s tax records indicate
“freelance” work. In Worth, the defendants sought a new trial or judgement as a matter of law,
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asserting the plaintiff was an independent contractor. Id. at 262. One of plaintiff’s tax returns listed
income from the defendant as “freelance” work. Id. at 261. The court, applying the “clear error”
standard of review, found there was sufficient evidence to find the plaintiff was an employee. Id. at
265. This case is much more similar to Fort Knox than Worth. Specifically, the tax return in Worth
was a single year return after a very brief alleged employment. Id. The court pointed out that the
plaintiff had testified that her tax preparer had made the determination that the work was freelance.
Id. at 264. Moreover, the plaintiff in Worth expected to have taxes and the costs of benefits taken
out of her paychecks. Id. Yonan, in contrast to the Worth plaintiff, offers no explanation why
several years of tax returns were consistently the kind equated with independent contractor status
and not the kind indicating an employee relationship with the Federation. The Court cannot ignore
the admissions in these forms. See Worth, 276 F.3d at 264 (holding how a plaintiff is paid is
relevant to whether he or she is an independent contractor); Fort Knox, 154 F.3d at 750 (same).
5.
Length of Job Commitment
Yonan suggests his 25-year career as a Federation-affiliated referee demonstrates he was an
employee. In general, “long term, exclusive relationships are consistent with employer-employee
status” whereas non-exclusive arrangements indicate independent contractor status. See e.g., Sulkin,
2000 WL 1508241, at *7 (citing Alexander, 101 F.3d at 493 and noting the plaintiff had worked for
two other companies while working for the defendant). While the Federation may not have allowed
Yonan to work professional games that were not Federation-affiliated, it is undisputed he could
work, and in fact worked, games not affiliated with the Federation. He could also refuse the
Federation’s assignments. Further, his 25-year career was really a series of one-year terms, because
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he was required to register with the Federation every year in order to be assigned work by the
Federation. Had he not registered, he would not have been assigned any games. This factor also
weighs in favor of finding Yonan was an independent contractor.
IV.
CONCLUSION
In short, all five factors indicate that Yonan was an independent contractor for the
Federation, not an employee. For the foregoing reasons, the Court grants USSF’s motion for
summary judgment (Doc. 52) and enters final judgment for the Federation under Rule 58.
________________________________________
Virginia M. Kendall
United States District Court Judge
Northern District of Illinois
Date: June 22, 2011
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