FIFA and MasterCard settle out of court- 21 Jun 2007 00:00:00
FIFA and MasterCard have settled their row over sponsorship of the next two World Cups out of court with the credit card brand agreeing to discontinue its involvement in exchange for a $90m compensation package.
As part of the pact, $87.5m is being paid to MasterCard in the second quarter of this year and $2.5m will be paid in the third quarter, the credit card provider said in a regulatory filing.
The landmark resolution paves the way for Visa to step in as a sponsor for the 2010 and 2014 World Cups in line with the previously agreed contract it was forced to leave dormant in light of MasterCard’s legal proceedings.
The agreement between MasterCard and FIFA means that the current legal proceedings over the case in the US and Switzerland have been disbanded.
MasterCard initially took FIFA to court after the football governing body agreed a deal with Visa without giving the incumbent sponsor first right of refusal.
A US appeals court upheld MasterCard’s view and ordered FIFA to abort its eight-year sponsorship deal with Visa.
The governing body has since been fighting the ruling in the appeals courts in the US and Switzerland with some degree of success. Earlier this month, a US appeals court ordered that the case be reviewed.
The decision ends nearly a year of speculation and ongoing legal action over FIFA’s handling of the sponsorship process. As a result of the proceedings, Jerome Valcke, FIFA’s marketing chief, and three of his staff were sacked for their roles in the negotiations.