The Court of Arbitration for Sport (CAS) issued a ruling on March 5, 2015, in a dispute between Club Grenoble Football 38 (Appellant) and Bologna Football Club 1909 S.p.A. (Respondent) concerning the termination of a player's employment contract and a subsequent claim for training compensation. The case arose when Grenoble’s commercial entity, SASP, entered judicial liquidation in 2011, leading to the termination of the player’s contract. The player then joined Bologna, prompting Grenoble’s association (the Appellant) to claim training compensation. The Respondent argued that the termination constituted a breach of contract, disqualifying the claim, and that only SASP, not the Appellant, was entitled to compensation as it had trained the player. The FIFA Dispute Resolution Chamber initially ruled in favor of Bologna, leading Grenoble to appeal to CAS.
The CAS panel, composed of Lars Hilliger, François Klein, and Lucio Colantuoni, addressed two key legal issues. First, it affirmed that financial difficulties cannot justify unilateral contract termination unless agreed upon or unless the economic problems are not attributable to the terminating party. In this case, SASP’s financial troubles, which led to judicial liquidation, were deemed its responsibility, rendering the termination unjustified. Second, the panel clarified that a club facing financial difficulties must prove its entitlement to training compensation despite contract termination. This requires demonstrating that the economic problems were not imputable to the commercial entity managing professional activities and that the club, not the commercial entity, had a genuine interest in retaining the player and was entitled to compensation.
The panel analyzed the relationship between Grenoble’s association and SASP under French law, noting that while SASP managed professional activities, the association retained affiliation rights. However, the panel found no evidence that the Appellant had trained the player or that the liquidation was beyond SASP’s control. Consequently, the CAS upheld the FIFA DRC’s decision, denying the Appellant’s claim for training compensation. The ruling reinforced the principle that financial struggles attributable to a club do not absolve it from contractual liabilities and that training compensation claims require clear proof of entitlement. The case underscores the importance of contractual adherence and the burden of proof in disputes involving financial distress and player transfers.
The dispute also highlighted procedural complexities, including language requirements and deadlines. The Appellant filed its appeal in French, while the Respondent insisted on English, the language used in FIFA proceedings. The CAS President ruled in favor of English, and the Appellant was granted multiple extensions to submit translated documents. However, the Appellant failed to provide full translations by the deadline, leading the Respondent to argue for the appeal’s inadmissibility. The CAS Panel ruled that untranslated documents would be disregarded but allowed the appeal to proceed. The Panel later deemed the Appellant’s belated "free translation" inadmissible, further weakening its case.
On the merits, the Panel concluded that the termination of the player’s contract due to SASP’s liquidation did not constitute just cause under FIFA’s Regulations on the Status and Transfer of Players (RSTP). It emphasized that economic problems cannot justify unilateral termination unless they are beyond the terminating party’s control, which was not proven here. Additionally, the Panel noted that no training compensation is owed for transfers within the EU/EEA unless the former club offers the player a new contract of equivalent value, which SASP failed to do. The Appellant’s failure to provide sufficient evidence to substantiate its claim, including proof of genuine efforts to retain the player or the nature of its cooperation with SASP, further undermined its case.
Ultimately, the CAS dismissed the appeal, upholding the FIFA DRC’s decision and rejecting all claims for relief. The ruling emphasized the Appellant’s failure to meet the burden of proof required to justify its entitlement to training compensation, reinforcing established CAS jurisprudence that parties must substantiate their allegations with convincing evidence. The case highlights the complexities of legal interpretation in sports arbitration, particularly when national and international regulations intersect, and underscores the importance of contractual obligations and player rights in situations of unilateral termination without just cause.