UPDATED: GPS Parent Company in Bankruptcy Court; GPS former employee criminal charges; Federal Investigations & State Lawsuits

Editor’s Note: I am updating the headline to be clear about two facts: (1) the party in the Bankruptcy Petition is GPS’ parent company – Legacy Global Sports – and (2) LGS is in Bankruptcy Court because creditors, not the organization itself, filed the Chapter 7 petition.

May 23 Update:  Chris Kessell reports on Twitter that GPS’ parent company, Legacy Global Sports, has been forced into Massachusetts Bankruptcy Court by the filing of an involuntary Chapter 7 petition by its creditors.  The case is pending in the Massachusetts Bankruptcy Court with case number 1:2020bk11157.

In addition, GPS Massachusetts has filed a lawsuit of their own against San Diego Surf Soccer Club.  The lawsuit alleges that 2 former GPS employees devised a scheme to divert business away from GPS and make a pathway for Surf into GPS players/coaches.   Click here to read the lawsuit.

Finally, a former GPS employee has pleaded guilty to obstruction of justice in Federal Court after the launch of the federal investigation into potential GPS wrongdoing.

A Scottish man who was previously employed by Global Premier Soccer LLC (GPS), a youth soccer organization, pleaded guilty today in federal court in Boston to obstructing justice. Gavin MacPhee, 34, pleaded guilty to one count of destruction, alteration, or falsification of records in a federal investigation. U.S. District Court Judge Douglas P. Woodlock scheduled sentencing for Sept. 21, 2020.

MacPhee used his access to GPS’s information technology platform to delete an email account and other files related to an ongoing criminal investigation. A search at GPS’s corporate headquarters was executed in October 2019. Thereafter, with full knowledge of the federal investigation and the relevance of those materials, MacPhee deleted at least one email account for an individual who had since left the company, and with whom he had a close relationship. The charging statute provides for a sentence of 20 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

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Jonathan Sigal at the New England Soccer Journal has done some tremendous sleuthing in regards to the leadership transition at Global Premier Soccer (GPS) since the announcement of Keith Caldwell as CEO.  Here are the basic facts that he has uncovered.

1. Federal officials executed a warrant at the Waltham offices of GPS in October, 2019.
2. The warrant concerns allegations of poor working conditions and immigration paperwork irregularity for GPS coaches coming from abroad.
3. The investigation appears to be targeting the former CEO, Joseph Bradley.
4. The GPS ownership group, Legacy Global Sports, is facing a state court lawsuit in Suffolk County alleging that they owe $3.7M as part of their 2016 purchase of the club.
5. A second lawsuit, meanwhile, was filed by GPS in state court against the large law firm, Burns & Levinson LLP, the lawyer for Bradley, alleging that the law firm has a conflict of interest.
6. Sigal received a comment from GPS and their owner Legacy Global Sports that stated that the owners nor the club are the target of the federal investigation.
7. The impact on the club’s sponsors, it’s partnerships with youth teams and it’s players remains to be seen.

Read the full story at NE Soccer Journal here and, if you have not already, make sure to buy your subscription today so that you can read reporting like this every week!