How U.S. Soccer’s legal arguments – not the ‘scorched earth’ ones – scored a victory over the USWNT on equal pay

A civil rights lawyer breaks down why a judge sided with U.S. Soccer on issues of Pay Equity and where the USWNT case for equal pay goes from here.

In the latest legal development in the ongoing equal pay saga, U.S. District Court Judge Gary Klausner granted summary judgment to U.S. Soccer on the most critical and consequential portions of the class action pay equity lawsuit initiated over four years ago by members of the U.S. women’s national team (USWNT).

A battle that has been fought primarily in the court of public opinion finally has a legal ruling on its central tenet.

Motions for summary judgment, which ask the Court to direct judgment in favor of one party on the law, are commonplace in federal practice prior to trial. In his ruling on motions filed by both U.S. Soccer and the USWNT, Judge Klausner dismissed the USWNT’s argument that its compensation structure was rooted in discrimination on the basis of gender. In fact, Judge Klausner held that the evidence in the record substantiated U.S. Soccer’s argument that in fact, the USWNT players were paid more than their U.S. men’s national team (USMNT) contemporaries.

Following the Court’s ruling, which also included a denial of the women’s cross-motion for summary judgment, the only legal claims that remain to be resolved by a jury are the USWNT allegations related to discriminatory working conditions, most notably — medical treatment and travel claims. The bulk of the USWNT claims that formed the players’ $66 million damages demand — are gone. A trial of the remaining issues is tentatively set for June 16.

Without question, the ruling is a haymaker of a blow to the USWNT’s legal fight for equal pay, which had transformed some of the best players, like Alex Morgan, Megan Rapinoe and Carli Lloyd, from the world’s best women’s soccer team into global gladiators for pay equity and women’s rights.

It is also a reprieve for U.S. Soccer’s legal team, whose “scorched earth” legal strategy, which had placed the Federation at odds with not only the majority of an already cynical fan base but also with key corporate sponsors, earned an immense — and until yesterday rare — victory over the USWNT in court.

What does U.S. Soccer’s victory mean in the context of the larger USWNT battle for equal pay? Is Judge Klasuner’s decision the death knell some have already made it out to be?

The players refuse to believe it is.

“We are shocked and disappointed with today’s decision, but we will not give up our hard work for equal pay,” Molly Levinson, spokesperson for the players, said in a statement, promising to press on.

But what of the legal arguments, the broader social consequences and a go-forward plan? It’s worth exploring each in turn.

Explaining the Court’s decision on Equal Pay

U.S. Soccer’s victory is the latest litigation reminder that whatever the optics, Equal Pay Act cases are hard to win in court.

The standard over what constitutes discriminatory compensation on the basis of gender is high, and because of the court of public opinion, the best Plaintiff’s cases usually settle.

Here, a court decided that despite competing factual claims, it could rule on the pay issue as a matter of law.

Why?

Judge Klausner, a rare California conservative appointed by President George W. Bush, was always likely to be a bit more receptive to U.S. Soccer’s argument that the pay structure for the USWNT wasn’t discriminatory, it was just different. This doesn’t mean his decision was political, just that he was a more favorable jurist for U.S. Soccer than other judges in the Central District of California may have been.

To survive the summary judgment motion, the USWNT needed to show (1) they were paid at a lower rate than the U.S. Men, with wages including not just base salary but all forms of compensation, including bonuses and benefits and (2) that this discriminatory wage structure was due to gender.

In his ruling, Judge Klausner noted the great amount of alleged competing evidence entered into the record on the wage compensation claim. But a large amount of evidence doesn’t necessarily mean there is a dispute in “material fact” — which is just legal language used to discuss facts central to a claim. To him, many of the USWNT arguments were non-sequiturs that had little to do with the bottom line of whether the USWNT pay structure was truly discriminatory.

As I have previously discussed elsewhere, there was always a decent chance U.S. Soccer would prevail in court. The U.S. Women’s argument for wage discrimination was a difficult one because it essentially asked the Court to evaluate the claim based on the USWNT’s interpretation of the compensation structure.

The USWNT argued that their wage compensation was discriminatory because their wages per-game and per-tournament were lower than the USMNT and second, they would have received a larger payout under the MNT deal.

U.S. Soccer responded to this argument in two ways.

First, they argued that the women’s compensation structure was the result of a collective bargaining agreement. If the USWNT rate of pay was unequal, it was because that was a choice made by the USWNT in the bargaining process. Second, using expert economist evidence, U.S. Soccer argued that in fact, evaluating all “wages” included under the statute, the USWNT actually received more money per game than the men.

The Equal Pay Act allows an employer to defend unequal pay structures by offering a lawful explanation, including that differences in pay reflect a seniority system or collectively bargained outcomes.

Before discussing the way this second argument became the basis for why the Court ultimately rejected the women’s argument, it is important to evaluate it in a larger structural context, and explain why, at least in the view of this civil rights lawyer, why the second point can’t be divorced from the first one. A larger understanding of the structural context behind the CBA should inform the USWNT path forward on appeal, at least to some extent.

First, there is a long line of cases that suggests the mere existence of a CBA doesn’t extinguish a wage discrimination claim. Further, the plain language of the Equal Pay Act provides that “collective bargaining agreements are not a defense” and dictates that if a collective bargaining agreement provides “unequal rates of pay” it is null and void.

This direct statutory language is likely the most fertile ground for a USWNT appeal. Workers can be coerced into accepting a CBA or accept one for reasons related to external forces. Courts consistently contemplate these external factors, or at least they are supposed to. The USWNT smartly pointed this out in its own summary judgment argument.

Second, and more critically, the USWNT argued that the existence of structural discrimination explained the reasons the USWNT accepted the CBA they did in the first place. The USWNT argued that they lacked an equal pay structure — and in a way were forced to bargain for basic guarantees in compensation — despite enjoying far greater on-field success than their male counterparts.

That argument is a helpful reminder of the stakes of this litigation.

After all, a compelling argument could be made that the U.S. Men’s National Team plays for its country while the U.S. Women’s National Team (and many other women’s national teams) play for the existential survival of their sport. If the most powerful, respected women in the sport could use their own collective bargaining agreement to advance the cause of investment in domestic women’s soccer and increase the economic security of other women in the sport in the process, they were almost certainly going to seize that unique and rare opportunity, even if it was against their own individual economic interests.

The USWNT’s argument on the CBA question is essentially that the “different” types of compensation the USWNT accepted, which included child care and health care benefits, injury insurance, improved contract status for players on the edge of the player pool — things U.S. Soccer framed as the “insurance value” of their compensation structure — were accepted because the U.S. Women knew their bargaining process was one of the only ways to assure basic employment guarantees for women’s soccer players more generally.

Judge Klausner’s 32-page order gave short shrift to these structural inequality/Sophie’s Choice type CBA arguments. Instead, the Court insisted that the CBA negotiations were fair and that the players simply entered a deal they now regret.

Judge Klausner’s opinion, as such, was less concerned with the structural reasons for the USWNT compensation structure. What mattered to him, in the end, was that the bottom line figure and the “insurance guarantees” that different types of USWNT compensation structure allowed. Total compensation is the standard for equal pay, not only things like per-game compensation or bonus structure, and once you included the “insurance value” benefits in the calculations, the wildly successful USWNT (collecting as much World Cup revenue as possible) were actually compensated at a higher rate than the under-achieving USMNT (missing out on World Cup money completely).

What about the rest of the order?

Judge Klausner was more persuaded by the USWNT claims that the players are subjected to inferior working conditions due to gender.

In their motion for summary judgment, the USWNT players noted that from 2015 to 2020 U.S. Soccer spent approximately $9 million on airfare for USMNT players but only $5 million for USWNT players, despite the USWNT playing more games. The hotel data reflected similar disparities.

Rejecting U.S. Soccer’s explanations for the differences, Judge Klausner found that a “gross disparity in money spent on airfare and hotels for the teams” exists. He further rejected U.S. Soccer’s defenses to inferior medical care and training conditions and support, agreeing that these issues should be decided by a jury.

While the women’s working conditions claims undoubtedly lack the monetary value of the pay equity arguments, the fact they survived the summary judgment stage does give the USWNT some flexibility in terms of its path forward and what comes next.

What now for the USWNT pay equity claims?

The U.S. Women functionally have two paths forward and interestingly, the decision not to appeal may be the most strategic.

The decision to appeal itself is complicated.

First, because this was only a partial summary judgment, it is not considered a final and appealable order. That means the USWNT’s attorneys would need to seek leave from the court to file what is called an interlocutory (while the case remains in motion) appeal. This process alone has costs and takes additional time.

An appellate process even without an interlocutory appeal in an employment case can take anywhere from one to three years, and with COVID-19 slowing the federal courts to a crawl, there’s a significant risk this case takes longer — meaning more legal fees and costs. Additionally, while Judge Klausner is a more conservative jurist than the 9th Circuit as a whole, his employment rulings have only around a 50 percent reversal rate. That makes the women’s chance of success on appeal basically a coin flip by the numbers, a risk they may not want to take given alternatives.

If the women do choose to appeal, the best path forward for the USWNT might be to argue that the District Court made a mistake of law when it didn’t give enough weight or consideration to the reasons motivating or compelling the USWNT to accept their compensation structure. Arguing that they were in essence given a Sophie’s Choice (accept the men’s deal and improve their own bottom line or accept a different compensation structure ensuring broadened economic security for more women’s soccer players as a whole), is something the Court should have considered.

Other appellate arguments — such as arguing the Court didn’t properly consider the USWNT experts on bonuses and rate of pay — would essentially invite the appellate court to revisit and make their own decision about the facts reviewed by the District Court. Appellate courts generally are very reluctant to disturb the lower court’s factual findings on appeal.

Settlement possibilities and why “scorched earth” didn’t really win

The possibility of a strong settlement for the USWNT even after losing summary judgment remains.

Indeed, a better strategy than an appeal may be to leverage both the U.S. women’s substantial victories in both the court of public opinion and on the remaining working conditions claims into a settlement both parties can live with. While this settlement wouldn’t formally include pay equity compensation, the USWNT could leverage the threat of an appeal and public perception into a financial figure that certainly accounts for some of those prospective damages.

The fact this option exists is largely a testament to the success of the USWNT public perception and pressure campaign, which was one prong of the USWNT legal strategy from the beginning.

The effectiveness of the USWNT to sway public opinion in their favor, and frame this struggle as representative of a much larger societal effort to value women’s rights and labor in the marketplace, is a vital and lasting impact of this lawsuit.

It’s why arguments that the U.S. Soccer “scorched earth” legal policy, which included the deployment of sexist argumentation about women lacking skill, didn’t really win the day.

On the contrary, the consequences of the sexist “scorched earth” strategy for U.S. Soccer were dire. U.S. Soccer President Carlos Cordeiro was forced to resign, multiple corporate sponsors of U.S. Soccer issued statements denouncing the federation and its legal strategy in a time of increasing economic uncertainty, and the law firm that advanced the sexist arguments in court, Seyfarth Shaw, was removed as lead counsel for the Federation in the lawsuit. None of that happens in a world without a “scorched earth” legal strategy.

In the end, an amended summary judgment response, filed by new counsel, which abandoned U.S. Soccer’s sexist arguments and instead focused on what was long U.S. Soccer’s best argument — that they compensated the women differently, but not in a way that was discriminatory — won the day.

Had U.S. Soccer simply pursued that narrow, smart argument from the beginning, they may have avoided a situation where they won a partial summary judgment on valuable pay equity claims only to have to pay the piper on the remaining claims anyway thanks to being routed in the court of public opinion.

What’s clear from this ruling, above all, is that everyone involved now has an incentive to sit down at the bargaining table, sooner rather than later. Expect that to happen soon.