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

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


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.