Maggie Haney v USA Gymnastics, Inc. and Mark Busby (US District Court New Jersey)

The background

Maggie Haney is a world renowned USA gymnastics coach. As at 2016, she was a professional coach, with a team of successful athletes, sought after by families from across the USA, all of whom wanted to move to New Jersey to train under her. Between 2006 and 2016, Haney coached, among others, Laurie Hernandez (who won Olympic gold and silver at the 2016 Games in Rio). Over the time from 2006 to 2016, Haney coached Hernandez over thousands of hours, and supported the Hernandez family financially by employing Hernandez’ mother, Wanda Hernandez, and by substantially discounting or not charging coaching fees. At no time prior to the 2016 Olympics did Laurie Hernandez or her mother or anyone else complain about Haney’ coaching practices.

In late 2016, Hernandez hired an agent, and released Haney as her coach. (Haney’s Complaint refers to the real cause being to avoid a previous agreement that Hernandez would be paid a percentage of Hernandez’ endorsements.) Prior to firing Haney, neither Hernandez nor her mother nor anyone else had ever complained about Haney’ coaching practices at any time up to the moment that Hernandez fired Haney as her coach.

On 4 June 2019, Haney received a Misconduct Complaint from USA Gymnastics, Inc. (USAG). No claimants were identified in that document. On 22 November 2019, USAG gave Haney a “Summary of Allegations”, saying that certain SafeSport Code and USA Gymnastics Code of Ethical Conduct violations had occurred with respect to 7 athletes (no claimants were identified in that document). On 9 December 2019, USAG gave Haney an “Investigation report”, that document was 6 pages long, contained no supporting evidence, identified 7 potential claimants, but noted that only 2 of those claimants had been interviewed by USAG, and that the allegations by the other 5 claimants were based solely on information from their parents and/or third parties. USAG then convened a hearing, which commenced on 3 February 2020.

The Hearing

USAG convened a panel on 3 February 2021, to hear the charges against Haney. At the hearing, Haney says:

1. USAG counsel Matt Busby instructed the Panel that Haney was not entitled to Due Process: “.. this is not a due process scenario … This is a fair process scenario, and a constitutional matter such as confrontation and cross-examination are not inherent in this process beyond what’s in our bylaws …” .
2. The Panel was instructed by USAG counsel Matt Busby that a hearing was not required to suspend Haney on an interim basis.
3. There was no hearing before the Panel suspended Haney on an interim basis, even though her counsel specifically requested that hearing.
4. The Panel prevented Haney from calling witnesses, including:
   1. highly regarded USAG coaches and judges;
   2. MG Elite personnel with direct knowledge of the specific allegations made by USAG against Haney;
   3. gym managers and other professionals with direct knowledge of the specific allegations made by USAG against Haney;
   4. medical professionals;
   5. former athletes trained by Haney;
   6. parents of current MG Elite athletes;
   7. parents of former MG Elite athletes;
   8. current MG Elite athletes who were direct training partners with the claimants.
5. The Panel prevented Haney from presenting evidence in her case, including contemporaneously prepared emails and letters of support from the above witnesses.
6. The Panel was biased.

Ultimately, the Panel suspended Haney from coaching for 8 years.

Appeal

On appeal, in an award dated 3 December 2020, the arbitrator:

• found that USAG failed to provide Haney with proper notice of the allegations from 4 of the complainants, and vacated all findings associated with those 4 athletes
• reduced Haney’s suspension from 8 years to 5 years

(Haney makes the point in her Complaint that she was suspended for 5 years and 3 months for (alleged) verbal abuse, that there is no precedent for such a suspension, and that USAG’s punishment was four times harsher that that imposed on coaches who have been proven to have physically and sexually abused young girls.)

Confidentiality

Finally, Haney says that throughout the hearing, she was subject to confidentiality agreement that USAG demanded that she sign before that hearing. But, says  Haney, USAG immediately publicised the Haney case and its ruling, including press interviews with USAG President and CEO Li Li Leung, and Laurie Hernandez. (On 10 February 2021, USAG brought new charges against Haney for allegedly speaking publicly about the charges against her).

Complaints by Haney

Haney says, in relation to that hearing:

1. USAG never gave Haney fair notice of the charges that she would need to meet prior to the 3 February 2020 hearing
2. USAG never gave Haney the chance to review the evidence against her prior to the 3 February 2020 hearing
3. USAG breached its own rules in relation to the above (ie in addition to the failure to accord due process).
4. USAG suspended Haney, albeit on an interim basis, at the start of (ie before she was afforded a) hearing.
5. USAG counsel Matt Busby instructed the Panel that Haney was not entitled to Due Process: “.. this is not a due process scenario … This is a fair process scenario, and a constitutional matter such as confrontation and cross-examination are not inherent in this process beyond what’s in our bylaws …” .
6. The Panel had substantial ex parte communication, on the record, between the panel, USAG’s counsel, and a complainant, without Haney’s counsel present.
7. USAG did not (even) follow the USOC Due Process Checklist relating to hearings pursuant to the Ted Stevens Olympic and Amateur Sports Act (“the Sports Act”), in the following respects:
8. notice of the specific charges or alleged violations in writing, and possible consequences if the charges are found to be true;
9. a hearing before a disinterested and impartial body of fact finders;
10. the right to call witnesses and present oral and written evidence and argument;
11. the right to confront and cross-examine adverse witnesses.
12.  

Remedies sought by Haney

Hany now seeks declarations and damages from the US District Court a declaration.

Can’t wait to read the Defence.

210802 Defendants' Motion to Dismiss

USA GYMNASTICS, INC. AND MARK BUSBY’S MOTION TO DISMISS

Maggie Haney v USA Gymnastics, Inc. and Mark Busby

United States District Court – District of New Jersey

Case 3:21-cv-07213-AET-LHG

On 29 March 2021, Maggie Haney filed a Complaint against USA Gymnastics, Inc. and Mark Busby, claiming the following:

Count I: for a declaratory judgment under the Sports Act that (in summary):

1. USAG failed to give Haney adequate notice of the charges against her;
2. USAG failed to establish timely hearing procedures that included reasonable discovery;
3. USAG failed to identify witnesses for Haney in advance of the hearing;
4. USAG failed to provide Haney copies of USAG’s investigative file;
5. USAG failed to provide Haney copies of exhibits prior to presenting them at hearing;
6. USAG failed to keep the hearing proceedings confidential;
7. USAG failed to comply with the most lax evidentiary rules;
8. Busby withheld exculpatory evidence from the hearing panel;
9. Busby falsely instructed the hearing panel that Haney was not entitled to due process;
10. the hearing panel was not impartial and was, in fact, biased.

Count II: for money damages under the Sports Act.

Count III: for Vacatur of the Arbitrator’s Award under the FAA.

On 2 August 2021, the defendants (USAG, and Busby) filed a Motion to Dismiss saying as follows:

1. The Complaint should be dismissed in its entirety, with prejudice, for failing to state any claim upon which relief can be granted.
2. The Complaint against Busby personally should be dismissed due to a lack of jurisdiction.
3. Haney’s claim to vacate the arbitrator’s award is time-barred.
4. Counts I and II must be dismissed because Haney has no private right of action under the Sports Act. The Sports Act expressly states that “no provision of this chapter shall create a private right of action”. The Sports Act mandates that challenges against NGB’s proceed through arbitration. Haney’s only remedy was to seek vacatur of the arbitrator’s award, but this is now time-barred.
5. Count III is time barred. The Federal Arbitration Act requires a party seeking to vacate an arbitration award to serve notice on the adverse party within 3 months after the award is delivered. Here, the arbitrator’s award was dated 3 December 2020, Haney filed her Complaint on 29 March 2021, and did not serve it on USAG until 30 March 2021, and on Busby until 3 June 2021.
6. The New Jersey District Court has no jurisdiction over Busby, a resident of Indiana.

The Motion to Dismiss is opposed by Haney, the parties are now to agree a Schedule to brief and present oral argument to the court.