Posted September 18, 2013

Chivas USA has fired its president — but he was far from the main problem

MLS
Jorge Vergara has presided over a run of futility and controversy since taking control of Chivas USA.

Jorge Vergara has presided over a run of on-field futility and off-field disasters since taking full control of Chivas USA. (Simon Barber/Getty Images)

Chivas USA did three quintessentially Chivas USA things Tuesday night.

The floundering MLS club fired president and chief business officer José David, who had been on the job for about 11 months. Chivas replaced him with Arturo Gálvez, an import from Guadalajara who’s now expected to jump right in and succeed in MLS.

To top it off, it announced the move at around 10 PM Eastern/7 PM Pacific, which is par for the wacky miniature golf course that is Chivas USA public relations. Predictably, the transaction didn’t generate much discussion. Even when making news, American soccer’s sideshow finds a way to remain irrelevant.

Chivas USA seems inscrutable at first glance. But if you’re courageous enough to pay close attention, a relatively reliable pattern takes shape over time. Just about everything the organization does can be explained by either its unshakeable belief that Southern Californians inevitably will embrace the Chivas brand or its refusal (or inability) to communicate effectively to the press and public.

According to MLS, an average of 8,230 fans attend Chivas games at StubHub Center. Nobody who actually goes thinks the crowds are that big, but it’s still the league’s lowest published total by far. In fact, it’s the worst one-season average in a decade.

If that was David’s fault, then he deserves to go. But Chivas USA’s attendance has been dropping for four years, and it isn’t logical to pin this season’s precipitous 37 percent plunge on one man.

It wasn’t David’s idea to cling desperately to a brand that alienates the vast majority of the club’s potential fan base.

Owner Jorge Vergara, not David, was the inspiration behind the offseason roster purge that gutted the club of numerous MLS veterans and led to charges that Chivas USA discriminated against players lacking Mexican roots.

David isn’t the reason Chivas USA’s current coach, José Luis Real, is the club’s eighth in nine years, not counting the caretakers who filled in following a firing. Nor is he responsible for the frequent front office turnover. No one, from former co-owner Antonio Cué to the departed Whit Haskel, Shawn Hunter, Stephen Hamilton or José Domene, has been able to bring Vergara’s vision to life.

The bombastic billionaire, who founded the dietary supplement company Grupo Omnilife, is the common element. And he doesn’t win on either side of the border. At least Chivas de Guadalajara, which has claimed one of the 22 Mexican league titles contested since Vergara bought the club 11 years ago, can continue trading off an identity that still means something to millions. In Los Angeles, the Chivas logo — which features Guadalajara’s municipal coat of arms — will appeal only to die-hard CDG fans interested in spending money on a third-rate facsimile of their beloved team. And clearly there aren’t many of those.

Yet Vergara holds fast to the brand — “To tell you the truth I don’t think the name is the problem. It’s not a solution that I have contemplated,” he told Hoy Los Angeles in August — and to the fantasy that the marketers and coaches he imports from Mexico will thrive in MLS.

It’s worth noting that when Chivas won in 2006-09 (yes, it once was a playoff team) Americans Bob Bradley and Preki Radosavljevic were on the bench. Its best average crowds came under Haskel and Hunter.

But Vergara isn’t swayed by empirical evidence. He bought out Cué last year and lamented the “divorce from Chivas Mexico.” He said, “We want to convert Chivas USA into the prodigal son that now returns to Chivas Mexico, to take advantage of the 106 years of experience of Chivas Mexico.”

That delusion has resulted in losses, lawsuits and eventually the announced crowd of 5,123 for Saturday’s draw with the Portland Timbers that likely sealed David’s dismissal. Nevertheless, Vergara remains dedicated to taking advantage of those “106 years of experience.”

David’s successor, Gálvez, has an extensive background in Mexican soccer and worked in a variety of capacities for Vergara in Guadalajara. Maybe he’s a miracle worker who will breathe life into the Chivas USA brand despite his lack of front-line familiarity with MLS and the L.A. market. Maybe Real and sporting president Dennis te Kloese (a Dutchman who moved to Mexico and now runs the soccer side of both Chivas teams) will find the formula their predecessors couldn’t.

The early returns (6-15-8 on the field) aren’t good. Lawsuits filed by two former academy coaches and a human resources manager accusing Chivas USA of ethnic discrimination are even worse. Whether or not they have merit, the fallout from those unresolved cases highlights the disconnect between the way the club communicates and the culture in which it resides.

Sending out late-night press releases, which practically guarantees a lack of attention (Chivas did the same when David was hired) is just the beginning. The club’s awkward inability to convey a coherent message was highlighted in July, when HBO’s “Real Sports” devoted a segment to Chivas’ controversial HR practices. Rather than craft an appropriate response HBO could share on the air, Chivas thrust director of soccer Juan Francisco Palencia into the hot seat. The El Tri legend isn’t a businessman, an attorney or a PR professional. English isn’t his native language. He was in so far over his head that his handlers had to cut the interview short.

The one-sided nature of HBO’s broadcast put Chivas in the worst possible light, despite the fact that it may have a valid defense.

It employs people from a variety of national and ethnic backgrounds. Chivas theoretically could argue — to a point — that a Mexican organization intending to honor its roots is best served hiring people familiar with that culture, in the same way that a French restaurant might prefer French cooks. The club certainly could have offered an explanation for its effort to gather information on the national origin of its youth players, which prompted a line of questioning that flustered Palencia. The truth is, a team arguably would be negligent if it didn’t learn whether a prospective player was eligible for multiple passports, thereby increasing potential transfer value.

But Chivas just took the body blows, embarrassing Palencia in the process. The next day, while commanding the attention of only a fraction of HBO’s audience, the club finally issued a statement. It accused HBO of painting an “incomplete and one-sided” picture (who’s fault was that?) and claimed that its diversity (employees supposedly hail from 15 countries on five continents) was one of its “biggest strengths.” In the garbled syntax that is the hallmark of any Chivas USA release, the club said, “We aim to work in an environment reigned by harmony.”

It was yet another clumsy moment for an organization that can’t communicate effectively or get out of its own way. If Chivas is forced to pay up, it very well could be because Vergara himself told employees that “If you don’t speak Spanish, you can go work for the [L.A.] Galaxy.” The buck stops with him, even though he refuses to acknowledge it.

MLS executives, including commissioner Don Garber, have expressed disappointment in Chivas’ on- and off-field performance and have reiterated the league’s commitment to diversity. But they haven’t gone much further. Vergara is a partner. He is an investor in, and therefore a part owner of, a limited liability company.

“People who operate teams in pro sports leagues are business partners. We decided to formalize that in a structure, commonly referred to as ‘single entity’,” MLS president and deputy commissioner Mark Abbott recently told SI.com. “As a partner, you’re subject to all of the league rules and that’s true for everybody, from an operating investor to a particular team.”

Unless Vergara breaks those rules, there’s not much MLS can do other than to continue to offer advice and support through its club services division. SI.com understands that Vergara has been approached by more than one potential buyer interested in purchasing his operating rights. He asked for at least $100 million, the amount Manchester City and the New York Yankees recently paid for their expansion team.

Last month Vergara told Hoy Los Angeles, “First of all, they can’t force me sell the franchise. That’s the reality. We know that there are laws in the U.S. that can’t force me to sell, but there isn’t any intention from their part to force me.”

He acknowledged mistakes without taking responsibility and promised, “We are working to keep improving.”

Perhaps Gálvez will help. But based upon his background, the timing of his appointment and the way it was announced, it’s hard to imagine that it’s anything but Chivas USA being Chivas USA.

10 comments
takethelongview
takethelongview

This website actually employs a writer whose beat is law and sports.  The kind of discrimination suit facing Chivas is unique in the annals of employment discrimination law, in that the defendant is a professional sports team.  So why hasn't Matthew McCann jumped into this discussion with his expertise?  He must get tired of the Alex Rodriguez and Aaron Hernandez stories sometime, right?

And it won't matter how diverse Chivas's workforce is because neither claim against it is a class-action suit.  Patterns are irrelevant.  If the fact-finder (judge or jury) determines that complaintant suffered a single, isolated act of discrimination, the club can be held responsible.  

Doug1
Doug1

MLS can't force him to sell his franchise, but can they collapse / contract it?  They contracted Miami and Tampa because of a lack of attendance and financial losses right?  Why not do the same to Chivas?

SeanDiSesa
SeanDiSesa

Everything that's wrong with single entity right here. The league can he held hostage by one team. 

Relegate Chivas! The Cosmos are outdrawing them in the NASL.

bserious
bserious

@SeanDiSesa Well, sounds like you're saying the problem is a lack of promotion/relegation, not single entity.  No other sports leagues in the US have promotion relegation, and none of them are single entity.  As to what seems to be your point, it ignores the fact that if the league had promotion/relegation, then MLS would not be able to drawthe big money owners they need to grow, nor would it have drawn many of the owners who have gotten the league to where it is now.  Plus, promotion/relegation doesn't stop owners from wrecking teams, it just keeps them out of the top league.  It certainly hasn't stopped a number of formerly proud clubs in England from getting destroyed, and it could be argued that the lure of promotion has caused owners to make poor decisions which end up hurting their clubs badly.  The problem isn't the league structure, the problem is leagues allowing unqualified people to buy teams in the first place.

SeanDiSesa
SeanDiSesa

@bserious I think removal of single entity and pro/rel go hand in hand. I agree that the league wouldn't have gotten to this point if it started with promotion and relegation because there would have been too much uncertainty at the beginning. At this point though, the league as a whole is stable and it is individual teams like Chivas that are struggling. Unfortunately with single entity Chivas are a drag on the entire league. 

I think the problem is indeed the league structure. If there were pro/rel, owners would be free to destroy their teams, and then would be relegated and lose value on their investment. MLS is already at 20 teams so it doesn't need to grow in terms of the number of teams. If anything, pro/rel would encourage investment in teams in the lower divisions, who would then have the opportunity for promotion. Let the market decide who is successful instead of propping up what the author himself calls "a third-rate facsimile of [Chivas Guadalajara]". If an ownership group makes bad decisions, they should suffer for that.

eggishorn
eggishorn

@bserious @SeanDiSesa Fundamentally, the advocacy of a club promotion/relegation system and Chivas USA's troubles have the same source: an insistence that soccer in the USA must parrot football in other countries in order to be successful.  As Straus details, Vergara apparently believes that Mexican-Americans will flock to his team if it looks like its Mexican League parent while ignoring the cultural settings that separate the two teams.  Insistence on MLS promotion/relegation has the same fault.  

No current sports league in the US has, or has ever had, a system of promotion and relegation.  The closest analogue is when a college sports program moves from one division to another, but these are most often uni-directional and always intended to be permanent.  Such as when a football program moves from the FCS to the FBS.  Routine promotion and relegation is entirely foreign to US sports fans, and has neither traction with, nor attraction to, them.  

Even more fundamentally, however, US soccer has a historical an cultural context that is often ignored.  Part of this context is the competitive sports environment for which leagues like EPL and Liga simply have no comparators. Soccer will not magically supersede the NFL, NASCAR, NBA, MLB, college football, college basketball, or even the NHL and UFC by becoming a second-rate parody of overseas leagues.  

Continuing attempts to "europeanize" MLS please only already-committed diehards while confusing and driving away the potential audience that MLS needs to grow.  Promotion and relegation and Vergara's bumbling are both outgrowths of this basic error.

bserious
bserious

@SeanDiSesa @bserious

OK, I didn’t would destroy the league, I’m it “could” end up hurting, but if we're taking reasoned statements to extremes, seeing as you mentioned England, are you saying that if promo/releg were to come in, then MLS would suddenly draw the big money investors and players and match the Premier League?  I don't think you are, just using that as a counter example, to try and keep things focused.  Now if you want to know how promo/releg possibly "could" destroy the league, well, what could happen is, with the introduction of promo/releg, people with big money would shy away from investing in the league, teams could be sold to people who are looking to make money by owning teams, those people might take risks which could end up putting teams out of business.And even if the teams were in lower divisions when they finally went under, if a few examples of teams this were to happen, especially if it happened to teams that had been once in the top division and/or a team or 2 in a big market city, a further pall would be cast over the league, which could set off a chain reaction of further discouraging people with money from investing in the league, meaning less money in the league for salaries and development, and so on and so forth.You can’t ignore the previous example of the NASL, the league died due to people trying to get to the top.I also think you’re overstating just how big a drag Chivas is on the league.Yes they’re an embarrassment, but people hardly use the team to define the league, there are still lots of potential big money owners looking to get in.And while I agree that at the moment, you can’t compare MLS to the other big American sports leagues, that doesn’t mean that using the ‘American sports league’ structure so to speak would stop MLS from eventually becoming a top league in the world.Yes, the Premier League is obviously popular and doing well, but have you not heard the stories of just how in debt many teams are, how many teams spend well beyond what they should, how big teams in Spain have basically been propped up by the government, and so on and so on.The one league that is the most stable is clearly Germany, but a lot of the other European leagues have a lot of problems.The fact of the matter is, people like cost certainty when they invest their money, and there’s a lot more cost certainty when there isn’t the threat of relegation.Furthermore, I’d guarantee that if you were to ask the owners of the big teams in various leagues, many if not most of them would love to stop relegation, and I also wouldn’t be surprised if, in the future, we end up seeing a break-away European league, or leagues, with a set line-up of teams that doesn’t change.I don’t want it to happen, but going by the survival of the fittest structure you admit promo/releg encourages, and taking into account the amount of debt there is in European soccer, it’s not a farfetched possibility to see small teams and leagues start to die off, and big teams take over.

SeanDiSesa
SeanDiSesa

@bserious And how is the Premier League doing without Leeds and Portsmouth? Seems to me it is doing just fine. Furthermore, Leeds and Portsmouth are now good opportunities for investors. They are historic names with relatively low values that could greatly increase if they return to the Premier League.

 I don't think you can compare MLS to the NFL, NBA, MLB, NHL because those leagues are all at the pinnacle of their sports. NBA owners aren't worried that their best players will leave to go play in Spain or Italy; they are attracting the best talent in the world, not exporting it. Conversely, top MLS players often transfer to better leagues abroad. I also think comparing the current situation to the failed NASL of the 80s doesn't make sense. The sports business is much more profitable these days, TV contracts have skyrocketed, and Americans are more exposed to the sport. Solid infrastructure has been established. How will pro/rel destroy all of that?

I'm not saying pro/rel is a magic solution to the problems of US Soccer, just the next logical step on MLS' path to becoming what it says it aspires to be: one of the best professional soccer leagues in the world.

bserious
bserious

@SeanDiSesa @bserious Well, that's where we differ, as what you’re saying sounds to me like saying it’s ok if some teams spend their way out of existence, let the strong survive, as that’s exactly what happened here 30 years ago, but so many teams did that, the league as a whole ended up going out of existence.When owners make bad decisions, it’s not just the owners who suffer, it’s also the players, the fans, and the sport itself.And the threat of relegation doesn’t stop owners from being dumb, as Leeds and Portsmouth have shown, just to name 2.Encouraging investment in lower league teams for the opportunity of promotion could be a euphemism for spending more than you can to chase the big money of the top league.I’m not against promo/releg in general, but I just don’t think it would have the magical effects that many think would happen should it be introduced here – it has both positive and negative aspects. Promo/releg is also not some unique structure that soccer needs, as some people think, it’s just how sports leagues are structured in other parts of the world, but the NBA, NHL, MLB, and NFL seem to have done decently well without it.