• Loading stock data...
Monday, November 4, 2024
The Best Employers in Sports survey is open through Nov. 6 Learn More

Golf’s Uneasy Alliance Leaves Unfinished Business

  • PGA Tour, LIV Golf feud ended with the partnership announcement, although details remain elusive.
  • After a final agreement is reached, the deal is expected to face legal, regulator scrutiny.
LIV PGA
Adam Hagy-USA TODAY Sports, A.J. Perez-FOS

Two bitter golf rivals took a big swing when they announced their controversial partnership earlier this month.

Now, it’s time to see where the ball lands.

It will take weeks — if not months — before a final agreement is reached by the PGA Tour, LIV Golf, and LIV’s major financial backer, Saudi Arabia’s Public Investment Fund. Then comes the expected regulatory, legislative, and legal scrutiny, both in the U.S. and in Europe.

This new for-profit golf entity, intended to bridge the chasm created in pro golf over the past two years, isn’t a lock. But there’s confidence on both sides that the partnership will come to fruition, and there’s already been one positive outcome: the end of litigation.

“That was massive,” one source close to the negotiations said.

LIV Golf dropped its antitrust case originally filed in August, the PGA Tour dropped its counterclaims against LIV and the PIF, and the PIF dropped its appeal as part of the tentative agreement.

That was a win-win decision — though maybe not for the many lawyers looking at a case that would’ve blown past the May 2024 trial date as PIF’s appeal was decided.

“There were tens of millions of dollars already being spent,” said attorney Ian Gunn, a sports law professor at Tulane. “There would probably be tens of millions more spent. The PGA Tour had significant exposure in terms of the actions that it took, which were certainly anticompetitive. At the end of the day, there might not have been as much liability [for the PGA Tour], but it was going to be a long battle.”

Backed by a $650 billion sovereign wealth fund, LIV possessed the money to fund a prolonged legal fight — although the PIF might not have been so keen on that approach.

The agreement did shine a light on the hypocrisy of PGA Tour commissioner Jay Monahan. He’ll become CEO of the new organization, which will control the business interests — including all the media rights deals — and will be backed by at least $2 billion of PIF money.

Adam-Silver-NBA

Could The NBA Be Open For Saudi Arabia’s Business? Maybe

Adam Silver doesn’t shut down the idea of Saudi investment in the…
June 11, 2023

On the other hand, there were likely a lot of closed-door PGA Tour machinations to thwart LIV Golf that won’t come to light (unless The New York Times’ motion to intervene to gain public access prevails).

The PIF’s appeal to the 9th Circuit earlier this year could have set an unwelcome precedent, considering its many other U.S. investments. If it lost, PIF not only would’ve been subject to discovery in this case — which included a deposition of PIF Governor Yasir Al-Rumayyan — but it would’ve made sovereign immunity arguments much more difficult in other cases moving forward.

But the motion to dismiss was granted on Tuesday — and none of the parties can refile the case since it was dismissed with prejudice. The PIF appeal was dismissed on Thursday.

“It would’ve been interesting,” Gunn said of a potential trial. “It would’ve been salacious, but I don’t know that we would’ve learned anything different about the character of the organizations and the people involved.”

Now What?

The shock of the announcement in pro golf circles has worn off. Not much is known about the deal — which was negotiated in private over the course of less than two months — other than what was in the original press release.

One insider scoffed when asked about letters sent by Sens. Richard Blumenthal (D-Conn.) and Ron Johnson (R-Wisc.) to Monahan, LIV Golf CEO Greg Norman, and Al-Rumayyan that invited the trio to a July 11 hearing in front of the Senate Permanent Subcommittee on Investigations. Al-Rumayyan will become chairman of the new entity.

“There are no deal points,” the source said. “There’s nothing final yet on the specifics of what the transaction will look like.”

Sources told FOS that the tenor of the most recent player meeting — held in Connecticut at the Travelers Championship on Tuesday night with Tour officials, minus Monahan who has taken a leave of absence to deal with an undisclosed medical issue — was calmer and more productive.

“The first meeting, they were shocked,” one source said. “I think they took a step back, and said, ‘Wait, the litigation is gone, and LIV potentially is no longer a threat.’ I think they can get over the secretive nature of it if the Tour takes steps to better communicate with players as this process plays out in the coming weeks and months.”

While the drama in the meetings has abated, there’s still not a lot to share at this point.

“The sad part is, I probably don’t even have a question they can answer. There just isn’t a whole lot of information out just yet. Some part of the agreement still needs to be written up,” seven-time PGA Tour winner Xander Schauffele told Sports Illustrated after the latest meeting.

There’s one major reason for that: The LIV Golf-PGA Tour lawsuit wasn’t officially dismissed until right around the time of that Tuesday meeting, when U.S. District Court Judge Beth Labson Freeman signed the order.

“That was a hurdle toward having meaningful business conversations,” one source said. “All that’s stopped. Now, everyone can be in the same room to sort out the transaction. There’s been a lot of progress.”

Aug 28, 2022; Atlanta, Georgia, USA; PGA commissioner Jay Monahan hands the FedEx Cup trophy to Rory McIlroy during the final round of the TOUR Championship golf tournament.
PGA Tour commissioner Jay Monahan and Rory McIlroy. / Adam Hagy-USA TODAY Sports

In From the Cold 

Even after final details are set, the PGA Tour’s five-player advisory board — which includes Rory McIlroy, one of LIV’s most outspoken critics — has to give its approval.

One potential issue is how players like Phil Mickelson (who reportedly received $200 million to join LIV),  Dustin Johnson ($150M), Bryson DeChambeau ($100M), Brooks Koepka ($100M), and LIV Golf will be, for lack of a better term, repatriated.

All the LIV Golf players who previously held PGA Tour cards remain suspended.

Top players like McIlroy and Tiger Woods are expected to earn some kind of reward for their loyalty, which could include an equity stake in the new company. Meanwhile, various scenarios have been discussed for lifting LIV players’ suspensions.

PGA Tour leadership will be discussing both ideas to potentially reward players who stood with the Tour as well as scenarios for the eventual return of LIV players after significant penalties which are expected to include — but not limited to — additional suspensions and fines.

But that’s all down the road. LIV Golf, which is more than midway through its second season, will be back for a third in 2024, and a 2025 season isn’t out of the question. LIV’s deal with The CW likewise runs through at least next season.

LIV would also need to wind down its contracts with golf courses, although those deals tend to command fees in the low seven figures to exit.

But the PIF isn’t going to let its $2 billion investment in LIV Golf languish while golf’s cold war thaws and the necessary negotiations on a final deal are readied for review by government officials, fans, and players.

“We want a deal to work out,” said one insider. “We’re excited about the future. We’re ecstatic that the litigation is over with.”

Linkedin
Whatsapp
Copy Link
Link Copied
Link Copied

What to Read

Vanderbilt Commodores fans head to the south end zone as the goal post is taken down by exuberant fans after beating No. 1 Alabama 40-35 at Vanderbilt Stadium in Nashville, Tenn., Saturday, Oct. 5, 2024.
opinion

Something New in College Football This Year: Parity

Upsets, surprises. CFB is more fun on the field than the NFL.
Sep 28, 2024; Tuscaloosa, Alabama, USA; GOP Presidential candidate Donald Trump waves flanked by former Georgia Bulldogs player Herschel Walker, recording art Kid Rock, professional golfer John Daily, Alabama senators Tommy Tuberville (R) and Katie Britt (R) during the second half of the game between the Alabama Crimson Tide and the Georgia Bulldogs at Bryant-Denny Stadium.

Mission Swing State: College Football’s Political Advertising Battle

Trump, Harris, and the PACs that support them are utilizing the sport.

The Untapped Revenue ‘Powder Keg’ of Women’s NFL Fandom

There’s a “boatload” of money at stake for brands and the league.
Nick Dunlap of Tuscaloosa, Ala., tees off on the 18th during the third round of the Sanderson Farms Championship at the Country Club of Jackson in Jackson, Miss., Saturday, Oct. 5, 2024.

PGA Tour Could Get More Exclusive Under Proposed Rule Changes

This is the latest move to consolidate more prize money and rankings points.
podcast thumbnail mobile
Front Office Sports Today

Surprising Start to MLB’s Offseason

0:00

Featured Today

Oct 19, 2024; Gainesville, Florida, USA; Florida Gators quarterback DJ Lagway (2) shakes hands while entering the locker room after a game against the Kentucky Wildcats at Ben Hill Griffin Stadium.
October 28, 2024

NIL Director Is the Trendy New Job in College Sports. But the Role Is Chaos

Athletic departments nationwide are hiring for what’s become their most important position.
FuboTV signage
opinion
October 26, 2024

Fubo’s Fight Against Streaming Giants Feels Futile

Fubo notched a legal win, but subs and stock still slump.
October 25, 2024

Inside The Wall at L.A. Clippers’ New $2B Home

FOS went inside the “contagious” energy at the L.A. Clippers’ Intuit Dome.
Oct 30, 2024; New York, New York, USA; New York Yankees pitcher Gerrit Cole (45) reacts after a play during the fifth inning against the Los Angeles Dodgers in game five of the 2024 MLB World Series at Yankee Stadium.

Gerrit Cole Reverses Opt Out, Stays With Yankees. What’s Next?

Discussions will now start on a potential contract extension to finish his career in New York.
November 3, 2024

Juan Soto Sweepstakes Underway: Superstar’s Deal Could Reshape MLB

The MLB superstar is set to gain the second-largest contract in U.S. pro sports history.
November 4, 2024

Saints Fire Dennis Allen: NFL’s Coaching Carousel Spins Early

The now-former Saints coach was in the third season of a four-year contract.
Sponsored

World Series Delivers High-Demand Marquee Matchup

The hype around the World Series matchup drove ticket prices to record levels—but the Dodgers’ dominance quickly quieted the fervor.
October 31, 2024

Everyone Wants In on the WNBA Expansion Gold Rush

There are 10 to 12 cities interested in a WNBA expansion team.
Oct 18, 2024; Minneapolis, Minnesota, USA; Minnesota Lynx forward Napheesa Collier (24) works around New York Liberty forward Breanna Stewart (30) during the first half of game four of the 2024 WNBA Finals at Target Center.
October 31, 2024

Unrivaled Expands While Keeping Seat Warm for Caitlin Clark

The women’s basketball league is adding six roster spots to bring the total to 36.
Oct 31, 2024; New York, New York, USA; Los Angeles Dodgers president and CEO Stan Kasten celebrates with the Commissioner’s Trophy after the Los Angeles Dodgers beat the New York Yankees in game four to win the 2024 MLB World Series at Yankee Stadium.
October 31, 2024

Dodgers Winning Formula Blends Underdog Spirit With Big Dollars

Team officials point to an “opportunistic” mindset as it overcame numerous injuries and setbacks.
Philadelphia Eagles quarterback Jalen Hurts (1) reacts to scoring a touchdown with Philadelphia Eagles running back Saquon Barkley (26) in the fourth quarter of the NFL game against the Cincinnati Bengals at Paycor Stadium in Cincinnati on Sunday, Oct. 27, 2024.
October 31, 2024

Here’s Every NFL Team Linked to Private Equity Investments

The NFL gave the O.K. in August for PE firms to buy up to 10% of a franchise.