By Elsa Buchanan, International Politics reporter
How a Brazilian sporting event company went from being FIFA’s darling to its backbiter
They had hired men dressed as Amazon trees, indigenous canoes and R&B singer Jennifer Lopez. On the night of the 12 June, excitement must have reached fever pitch at Team Spirit, the go-to company responsible for organising the opening and closing ceremonies at the FIFA World Cup in Brazil.
But the elation was short-lived for the Brazilian sport marketing and events company hired by FIFA’s Local Organising Committee (LOC) to manage last summer’s BRL 38 million (£11.1 million) colourful shows.
Just six months after Shakira sang her ‘La La La’ hit in a frivolous feather and sequin costume at the closing ceremony, Team Spirit is confronting a legal battle with FIFA’s LOC.
The exact nature of the dispute remains unclear, but an anonymous source told the Independent the legal dispute concerns claims that FIFA had not paid the company’s founder and CEO Alan Cimerman in time to cover a debt of over BRL 1 million (£250,000) with his bank, Banco Safra.
What is clearer, however, is that at least seven cases have been opened by costume, décor and video equipment suppliers against Team Spirit in the last three months for breach of contract and, or, non-payment related to services provided during the World Cup ceremonies.
Facing lawsuits totalling over half a million Brazilian reais, FIFA’s one-time darling has been unable to repay the bank, and his assets have been frozen. The CEO has been forced to liquidate Team Spirit, subsequently dismissing all employees, and closing the Sao Paolo office.
But after acknowledging that he did not manage the costs of the events correctly, a bitter Mr Cimerman blamed the FIFA for his company’s failure to repay suppliers.
“This project brought [me] prejudice. It was supposed to cost BRL 15 million and ended up costing BRL18 million. The gringos began to demand absurd and expensive things. Maybe it was not administered the right way. I [got it] wrong,” the Folha de Sao Paolo reported him as saying.
FIFA has affirmed that all debts were repaid with the company and that the football organisation has no connection with the company’s debt with suppliers.
“The LOC fulfilled all contractual obligations with Team Spirit,” Saint-Clair Milesi, a spokesperson for the World Cup Organising Committee in Brazil told the Independent.
But ahead of the Rio 2016 Olympic Games, which opening ceremony is estimated at BRL132 million (roughly seven times that of the World Cup’s) these events have highlighted the issue of accountability within the organisation of international sporting events.
When it comes to choosing tenders or contractors such as Team Spirit, UK Sport (the UK Government’s organisation specialised in the organisation of World or European Championships, Cups or Grand Prix in the UK) can only stress how vital it is to “seeking multiple tenders, ensure appropriate tender processes are followed and all references are thoroughly checked”.
In this new Brazilian novella, the FIFA’s go-to company did have a good track record prior to the World Cup fiasco.
Between 2010 and 2012, it had rolled out a popular marketing campaign for Brazilian football team Corinthians, had the first edition of the Aon Golf Cup in Sao Paolo and had operated at an international level providing media companies with entertainment spaces in the Olympic Village during the 2012 London Olympic Games.
In addition, the agency had also claimed to have brokered sponsorship agreements between Robinho and Samsung, and Kaka with Sony, as well as a licensing deal between FIFA and AGC Asahi Glass, a Japanese glass supplier.
But UK Sport’s acting head of major events Rebecca Edser insisted she “would want the sport’s National Governing Body to ensure a contract is in place that includes a delivery schedule and references performance standards” to ensure good practice.
It is at this precise stage that performers and suppliers should have picked up the first telling signs.
Mr Cimerman sparked controversy in March – two months before the ceremony – by refusing to pay producers for the show telling them the “budget [for artistic payments] was reduced”. For Ponto Midia, a video equipment supplier which launched a BRL 138,128 lawsuit against Team Spirit for breach of contract, payment had been a cause of concern from the start.
“We told him [Mr Cimerman] to pay the money before the ceremonies otherwise we wouldn’t provide the service. We were firm about that. We exchanged many electronic messages [but] we haven’t received the rest of the money, which was supposed to be paid after the closing ceremony,” a source who waived his right to anonymity told the Independent.
“Our initial contract was BRL 340,000 and he [Mr Cimerman] paid us a total of BRL 200,000 in two instalments: one before the opening ceremony and one just before the closing ceremony. But Alan Cimerman was very ill-intentioned when he did this to everybody. There are many suppliers waiting for compensation,” the source added.
During the last contact Ponto Midia had with Mr Cimerman in October, Team Spirit’s CEO claimed he “did not have the money to pay anybody”, the source said before adding he believed the FIFA committee “should pay” compensation to the providers.
However, the Brazilian Senate’s controversial Law 12.663/2012 (General Law of the World Cup), which requires the state to assume civil responsibility – instead of FIFA -for any “damages” during the events, is disserving the suppliers’ case.
The country’s federal prosecutor did try to challenge the constitutionality of the bill last year by claiming the legislation was giving FIFA too much power, but his claim was rejected.
“Actually we sent the receipt of the invoice to the LOC, however, they were not the ones supposed to pay, Team Spirit was – now it is up to the Justice System to have an action against him. By special law in Brazil, the LOC cannot be prosecuted we are told,” the source added.
At least 12 suppliers are still awaiting payment from the company, whose show once made the world want to samba.