Olympique Lyonnais v. Bernard

The French soccer club Olympique Lyonnais SASP (Olympique) (plaintiff) signed Olivier Bernard (defendant) to a three-year joueur espoir contract. Under that type of contract, during those three years, Bernard was training and working toward playing at the professional level under Olympique’s tutelage. At the end of the contract period, Olympique offered Bernard a one-year professional contract. But Bernard rejected the contract and signed instead with the English club Newcastle United FC (Newcastle) (defendant). Olympique sued Bernard and Newcastle, seeking the amount of money that Bernard would have received under the one-year contract Olympique had offered. According to Olympique, it was entitled to compensation for the three years it had spent training Bernard to prepare for play at the professional level. However, Bernard and Newcastle noted that a previous European Court of Justice opinion had held that the right to freedom of movement under Article 45 of the Treaty on the Functioning of the European Union (TFEU) prohibited transfer fees. According to Bernard and Newcastle, the training compensation here was similar to the transfer fee at issue in that case. The advocate general (AG) issued a preliminary opinion on the matter. According to the AG, although training-fee damages implicated the TFEU’s freedom-of-movement provision, that was overridden by the public-policy goal of incentivizing soccer clubs to train young players. The AG argued, however, that such costs had to be limited to the actual costs of training players. Moreover, if a club trained multiple players before a trade, the traded player would be required to pay only his own training costs. The matter was submitted to the European Court of Justice.