Mastercard International Incorporated v. Visa International Service Association, Inc.

471 F.3d 377 (2d Cir. 2006)

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Nature of the Case

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Facts

The original action was Mastercard Int'l Inc. v. Fed'n Internationale de Football Ass'n. Mastercard (P) sued Fed (D) seeking enforcement of a contractual provision giving P 'first right to acquire' exclusive sponsorship rights in its product category for the D World Cup event in 2010 and 2014. Prior to the suit, D was also in negotiations with Visa (D) regarding the same sponsorship rights. P learned that D had decided to finalize an agreement with Visa (D). P notified both D and Visa (D) that it considered D's actions a violation of the right of first refusal provision in the MasterCard Contract and MasterCard would seek legal redress if D went forward with the Visa (D) Contract. On April 10, 2006, Visa (D) issued a press release announcing its contract with D for exclusive sponsorship rights in the World Cup through 2014. P filed its suit for breach of contract and sought injunctive relief 'enjoining D from consummating, effectuating or performing' any terms of the Visa (D) Contract and ordering D to perform its obligations under the alleged contract granting MasterCard exclusive rights through 2014. Visa (D) sent a letter to the district court stating that it was a necessary and indispensable party to the litigation because of its contractual entitlement to D sponsorship rights. Visa (D) claimed the case must be dismissed for lack of subject matter jurisdiction. P and Visa (D) are both incorporated under the laws of Delaware. Visa's (D) joinder would destroy diversity jurisdiction-the sole basis for federal jurisdiction. The court ruled on the letter as a motion to dismiss under Federal Rule of Civil Procedure 19. The district court denied Visa's (D) motion, finding that Visa (D) was not a necessary party under Rule 19(a), and even assuming that it was, Visa (D) was not an indispensable party under Rule 19(b) requiring dismissal of the action. If P prevailed in this lawsuit, Visa's (D) right to sue D for breach of the warranty provision in the Visa (D) Contract would not be prejudiced and since Visa (D) that it had no knowledge of the dealings between P and D it would have nothing to contribute to the outcome of that lawsuit. Visa (D) appealed and also moved under Rule 24 to intervene which was denied.