The photo finishes, decades long rivalries, crowds going from silent to roaring in seconds are all part of what makes sport fascinating- competition. But what happens when sports organisations compromise this fundamental element of the game? Legally, golfers are independent contractors. But when, one by one, 11 PGA players chose to take part in the LIV Golf tournament, as well as the PGA, the PGA issued suspensions to each of them. As a result, these players are bringing an antitrust lawsuit against the PGA for acting anti-competitively. Although the lawsuit will take about three years, I’m going to speculate about what issues could be raised in this lawsuit.
Who are the PGA and LIV golf?
The PGA is the Professional Golfers Association of America. It is responsible for organizing the PGA Tour, one of, if not the biggest, golf competitions in the world. LIV golf is another golf competition which was founded in 2021 and is currently in its first season. While the PGA Tour is a private American company, the LIV golf tournament is backed by the Saudi Public Investment fund. There’s no doubt the rivalry between these two tournaments may go beyond the green.
What’s the controversy?
LIV offered more lucrative sums to players in a bid to recruit golfers to take part in their tour. While the PGA Championships have a minimum payout sum of $24,000, players taking part in LIV golf tournaments receive a minimum of $120,000. In light of this and sentiments among players that the PGA was too controlling, some top players such as Phil Mickelson and Dustin Johnson chose to play on the LIV golf tour. Shortly after these players started their first LIV golf tournament, the PGA suspended them from the tour. The PGA Tour commissioner, Jay Monahan, said that this was because the players sought to financially benefit from the LIV golf tournament and therefore can’t have the same privileges as other PGA golfers. The players sought, in vain, an injunction to allow them to compete in the FedEx tournament after the PGA Tour had suspended them. However, they and 8 others have filed an antitrust lawsuit against the PGA Tour for being anticompetitive.
Per the Washington Post , the players contend that by threatening golfers, sponsors, vendors and agents to not play in LIV events, working with the European Tour to stop LIV golf from working with their players and pressuring the other four major golf championships to ban LIV golfers from taking part in them, the PGA Tour is harming players and preventing competition in the golf market. To succeed, the players will have to show that they have suffered actual harm and that the PGA Tour’s suspension compromised competition. It may be difficult to demonstrate actual harm given that they are earning much more playing in LIV tournaments, but they may have more success showing that the PGA Tour’s actions have compromised competition.
Promoting or stifling competition
Although it’s true that these golfers are able to freely contract with the LIV Golf tour, they may be bound to other restrictive conditions as a consequence. The LIV Golf Tournament is sponsored by the Saudi Public Investment Fund. There has been much criticism of the LIV Golf Tournament because it is funded by a government that is headed by Prince Mohammed Bin Salman who allegedly was complicit in the murder of journalist Jamal Khashoggi. Saudi Arabia overall doesn’t have an incredible human rights record, although there have been a few progressive steps such as women being allowed to drive. But whether sports should be intertwined with politics deserves an article of its own.
The spokesperson for the LIV golf tournament in response to the actions of the PGA tour said that the ‘era of free agency’ is beginning. PGA golfers are de jure independent contractors and not employees of the PGA Tour. However, as members of the PGA Tour, they have to seek permission in order to play in non PGA Tournaments. These two realities seem conflicting. Provided that PGA golfers are playing in the PGA Tour, they should be free to do what they want with their time outside this time. As it stands, there is an arrangement that the PGA Tour has with the European tour to allow PGA Tour golfers to take part in non-sanctioned tournaments- it wouldn’t be inconceivable for such an arrangement to be worked out with LIV golf.
The PGA’s reluctance to allow their players to independently contract with other associations seems rather anticompetitive. Attorney Peter Ginsberg commenting in an interview about the players' suit against the PGA Tour noted that the actions of the PGA Tour are monopolistic and controlling of players, and this is just one example of this. When asked about what regulations the tour can enforce given that the players are independent contractors, he noted that the PGA is not unionised, unlike the NFL. The lack of a formal collective bargaining arrangement means that golfers are in a weaker position when it comes to dealing with the PGA Tour. Yet another reason why the Tour has no right to monopolise the sport.
According to the Washington Post the feds have looked into the PGA Tour before for being anticompetitive. Efforts by antitrust lawyers in 1994 to get rid of the rule mandating golfers to get permission to play in conflicting events and to appear on TV programs not approved by the PGA Tour were quashed by lobbying by the commissioner of the PGA at the time, Tim Finchem.
The PGA Tournament's decision to prevent its players from playing in another competition seems contrary to the players legal position as independent contractors. It's certain that in the golf world, the PGA is the biggest player and LIV may soon join it's ranks. But whether the PGAs attempts to maintain it's lead will result in it surviving yet another anti-trust investigation will be a matter decided long into the future.
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