The Antitrust Case that Could Reshape Professional Golf
By Ben Steinberg and Jordan Finkel
March 13, 2023
The world of athletic competition is no stranger to competition law. The latest antitrust dispute to make sports headlines involves the growing rivalry between two professional golf leagues: the long-dominant PGA Tour and the upstart LIV Golf tour, funded by Saudi Arabia’s Public Investment Fund (PIF).
LIV shook-up the golf world last year when it signed lucrative contracts with some of the world’s best golfers to play LIV-sponsored golf tournaments, luring them away from the PGA tour. The PGA responded by suspending the golfers indefinitely, barring them from PGA tour events.
Last August, several of those golfers and LIV sued the PGA in federal court in California for antitrust violations under Sections 1 and 2 of the Sherman Act. See Mickelson et al. v. PGA Tour, Inc., No. 3:22-cv-04486, 2022 WL 3083626 (N.D. Cal. Aug. 3, 2022). LIV and its golfers alleged that the PGA has unlawfully monopolized professional golf events and illegally conspired with others to stop LIV’s expansion. LIV alleges the PGA restrains competition by threatening golfers and their associates not to work with LIV, conspiring with the European PGA Tour to cutoff LIV’s access to pro golfers, and manipulating its rules to stop golfers from participating in LIV’s events.
The litigation quickly expanded into a more complex geopolitical affair. In September, the PGA countersued LIV for tortiously interfering with its golfers and named as defendants LIV’s financers: the $650 billion Saudi PIF and its governor, Yasir Al-Rumayya. The Saudi PIF and Al-Rumayya then argued they were immune from discovery due to their sovereign immunity as foreign state actors. The court rejected that argument last month and upheld the PGA’s foreign subpoenas, potentially offering the PGA a rare glimpse into one of Saudi Arabia’s most politically sensitive institutions.
The dispute also has political dimensions in the U.S. The U.S. Department of Justice reportedly is investigating the PGA and certain affiliates for much of the same conduct alleged in LIV’s lawsuit. And former President Donald Trump has publicly backed LIV and agreed to host LIV events at Trump-branded golf courses.
Meanwhile, the suspensions imposed by the PGA remain in effect; LIV golfers are still prohibited from participating in PGA Tour tournament play and PGA-sanctioned events. However, the hosts of the four “major” golf championships (e.g., the Masters and the U.S. Open) have each declared LIV golfers eligible to play in the 2023 major tournaments, maintaining LIV golfers’ access to golf’s most coveted events.
As the 2023 golf season swings into action, the civil suit between LIV and the PGA is moving apace. The Court has tentatively scheduled a summary judgement hearing for July, and trial is currently scheduled for January of 2024. We expect there will be many more developments in the case, both inside the courtroom and on the golf course, over the coming year.
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