CAS Case Digest · Verified against the full award text

CAS 2024/A/10785 — FC Durham Academy v. New York Red Bulls

"FC Durham Academy v. New York Red Bulls" · CAS held that NYRB and NYRB II are the same 'club' for FIFA training compensation purposes, reversing the FIFA DRC.

What happened in FC Durham Academy v. New York Red Bulls

FC Durham Academy, a Canadian club, trained player O'Vonte Mullings as an amateur from May 2015 until December 2018. On 1 January 2022, Mullings was registered as a professional with New York Red Bulls II (NYRB II), a USL Championship club, and later loaned to New York Red Bulls (NYRB), an MLS club, on 26 May 2022. Durham Academy claimed USD 100,191.79 in training compensation from NYRB before the FIFA DRC. On 25 January 2024, the FIFA DRC rejected the claim, finding that NYRB and NYRB II were not the same club and that NYRB therefore lacked standing to be sued. Durham Academy appealed to CAS. The Sole Arbitrator conducted a functional, fact-sensitive inquiry and concluded that, notwithstanding their formal separation as corporate entities, NYRB and NYRB II are so deeply integrated — sharing branding, training facilities, a unified player development pyramid, a single FIFA TMS account, and operating under the same USSF governance — that they constitute one single 'club' for FIFA training compensation purposes. The award annuls the FIFA DRC decision and remits the case to the FIFA DRC to determine the proper club categorisation and the resulting training compensation amount. The case matters because it establishes that the concept of 'club' under the FIFA RSTP is not automatically limited to a single legal entity.

Procedural history of CAS 2024/A/10785

On 28 February 2023, FC Durham Academy filed a claim before the FIFA Dispute Resolution Chamber (FIFA DRC) seeking USD 100,191.79 in training compensation plus interest from New York Red Bulls, arising from the Player's first professional registration with NYRB II on 1 January 2022. On 25 January 2024, the FIFA DRC rendered its decision (grounds communicated 17 July 2024), rejecting the claim on the basis that NYRB and NYRB II were not the same club and that NYRB therefore lacked standing to be sued. On 7 August 2024, FC Durham Academy filed its statement of appeal with CAS pursuant to Article R47 et seq. of the CAS Code (2023 edition). The Respondent failed to file an Answer within the deadline of 24 October 2024; its extension request was received one day late on 25 October 2024 and was rejected. A hearing was held by videoconference on 4 February 2025. CAS was asked to set aside the Appealed Decision and award training compensation, or subsidiarily USD 26,054.79.

Key holdings in CAS 2024/A/10785

• Two formally separate legal entities may be deemed one single 'club' for FIFA training compensation purposes if there is substantial evidence of sporting, organisational and operational integration, notwithstanding any formal separation in corporate structure.
• The concept of 'club' in Article 3.1 of Annex 4 FIFA RSTP must be interpreted teleologically so that the training compensation system cannot be undermined by clubs operating teams as separate legal entities while retaining sporting and operational control.
• NYRB and NYRB II are the same 'club' for training compensation purposes under the FIFA RSTP, and consequently NYRB has standing to be sued for training compensation arising from the Player's first professional registration with NYRB II.
• A respondent that fails to file an Answer within the CAS deadline is limited at the hearing to reiterating and expanding on arguments made in the first-instance proceedings, and may not submit new evidence unless exceptional circumstances under Article R56 of the CAS Code are established.
• Where the FIFA DRC has not made a first-instance determination on the proper categorisation of a club for training compensation purposes, CAS will remit the case to FIFA rather than decide the categorisation itself, in order to ensure consistency with applicable regulations and existing policies.

How the CAS panel reasoned

The Sole Arbitrator began with a two-step analysis: first, whether in the abstract two separate legal entities can constitute one 'club' under the FIFA RSTP; second, whether NYRB and NYRB II specifically met that standard. On the first step, the Arbitrator found that the literal text of Article 3.1 of Annex 4 FIFA RSTP and the FIFA Statutes definition of 'club' did not provide absolute clarity, requiring resort to teleological interpretation. The training compensation system is designed to reward clubs that invest in youth development and to prevent clubs from simply recruiting rather than training players; restricting 'club' to a single legal entity would allow organisations to circumvent this purpose by registering players in lower-tier subsidiaries. On the second step, the Arbitrator conducted a fact-sensitive, functional inquiry across multiple factors: the MLS single-entity employment model (which structurally requires separate employers and explains the loan mechanism and visa requirements, reducing their weight as indicators of separation); the New York Red Bulls' publicly displayed vertically integrated Player Development Pyramid identifying NYRB as the 'first team'; shared training facilities; near-identical branding differentiated only by 'II'; official communications treating NYRB II as an affiliate within the same organisation; the Player's entry via the 2022 MLS SuperDraft; a USSF player passport listing only NYRB; and a merged FIFA TMS account. The Respondent's arguments regarding separate HR, payroll, medical teams and the loan/visa formalities were rejected as explicable by the US sports model and the inherent differences between two teams at different levels. The Arbitrator noted the Respondent had not filed an Answer, which affected the evidentiary balance.

Why FC Durham Academy v. New York Red Bulls matters in CAS jurisprudence

This award establishes, for the first time in a published CAS ruling, that the concept of 'club' in the FIFA training compensation framework is not automatically confined to a single legal entity. It creates a functional, multi-factor integration test applicable to multi-team organisations — particularly relevant in leagues with single-entity structures such as MLS — and closes a potential loophole whereby clubs could reduce or eliminate training compensation liability by registering players in separately incorporated lower-tier affiliates.

Cases cited in this award

CAS 2014/A/3710 Bologna FC 1909 S.p.A. v. FC Barcelona CAS 2019/A/6463 CAS 2020/A/6854 CAS 2021/A/8076 Sport Lisboa e Benfica SAD v. FIFA CAS 2013/A/3365 & 3366 Juventus FC & A.S. Livorno Calcio v. Chelsea FC CAS 2007/A/1352 MKE Ankaragücü Spor Kulübü v. Ch. Coridon

Frequently asked questions about FC Durham Academy v. New York Red Bulls

Did CAS find that NYRB and NYRB II are the same club for training compensation purposes?

Yes. The Sole Arbitrator concluded that, notwithstanding their formal separation as corporate entities, NYRB and NYRB II are so deeply integrated — sharing branding, training facilities, a unified Player Development Pyramid, a single FIFA TMS account, and operating under USSF governance — that they constitute one single 'club' for FIFA training compensation purposes. The FIFA DRC decision rejecting the claim for lack of standing was annulled and the case was remitted to FIFA.

Why did the FIFA DRC originally reject FC Durham Academy's training compensation claim against New York Red Bulls?

The FIFA DRC rejected the claim on 25 January 2024 on the basis that NYRB and NYRB II were not the same 'club' and that, since the Player's first professional registration was with NYRB II and not NYRB, the Respondent (NYRB) lacked standing to be sued. CAS reversed this finding on appeal.

How much training compensation did FC Durham Academy claim, and was it awarded by CAS?

FC Durham Academy claimed USD 100,191.79 in training compensation plus 5% interest per annum from 31 January 2022, or subsidiarily USD 26,054.79 plus the same interest. CAS did not award either figure; instead it annulled the FIFA DRC decision and remitted the case back to the FIFA DRC to determine the proper club categorisation and the resulting compensation amount, as the FIFA DRC had never addressed categorisation at first instance.

What is the legal test CAS applied to determine whether two separate legal entities are the same 'club' for FIFA training compensation purposes?

The Sole Arbitrator applied a functional, fact-sensitive, multi-factor integration test grounded in a teleological interpretation of Article 3.1 of Annex 4 FIFA RSTP. Relevant factors included shared branding and visual identity, a unified player development pyramid, shared training facilities, common FIFA TMS administration, USSF player passport treatment, official communications, and the nature of the domestic league structure. No single factor was decisive; the inquiry assessed the overall depth and breadth of sporting, organisational and operational integration.

Topics: Training compensation & solidarity at CAS

Source: official award. This digest was generated by LexXi from the full award text and machine-verified against it — every figure, article and citation above appears in the source. It is an editorial summary, not legal advice. See how ElevenLex verification works.