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Now that the PGA Tour has officially suspended seventeen players for agreeing to participate in an LIV Golf event, the Tour could face “a major” anti-trust lawsuit, according to some lawyers who specialize in noncompete law.
“The PGA Tour is really opening itself up to a major lawsuit with potential antitrust claims and also a situation where they can’t justify what they’re doing other than saying, ‘We don’t like competition,'” said John Lauro, a New York- and Florida-based attorney.
“And the courts are going to be very concerned about why the PGA Tour is doing this,” Lauro continued. “These issues are now being looked at very carefully from an antitrust perspective by the courts. The courts look very skeptically on any kind of restraint of trade, and that would be part of what the PGA Tour is doing.”
And if you take a look at the memo issued to members by the PGA Tour, they certainly do sound nervous about the competition that LIV Golf presents.
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In it, PGA Tour commissioner Jay Monahan accuses LIV participants of “turning their back on the PGA Tour.” He then gets a bit petty and nitpicks them for not filing the proper paperwork: “As you know, (the LIV) players… did not receive the necessary conflicting event and media rights releases – or did not apply for releases at all.”
He also seems to judge the players for wanting to play for money.
“These players have made their choice for their own financial-based reasons,” Monahan tsk-tsks.
Apparently, Monahan thinks the PGA Tour is a charitable organization. But it’s not. It’s a well-funded business that, until now, never had to compete for golfers or audiences. The Saudis and LIV Golf have changed all that.
According to Lauro and fellow attorney Jonathan Pollard, the PGA Tour will face lawsuits for suspending the players and that they will have a tough time convincing a court that they had to do so to protect vital proprietary interests.
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In order to enforce a noncompete agreement successfully, Pollard says that the PGA Tour would have to demonstrate that player participation in an LIV Golf event would jeopardize “confidential information or trade secrets, protectable customer relationships or an extraordinary investment in the employee’s education or training. “
“Those are the three biggest and most commonly litigated legitimate-business interests upon which a court could enforce a noncompete agreement,” Pollard said. “And, if you look at this situation with the PGA Tour, none of those interests is even remotely present.”
Not to mention, the suspension of the players just doesn’t make much business sense.
“(The PGA Tour is) going to have to drop their opposition to this,” Pollard predicts, “because nobody is going to want to watch the PGA Tour if these top players aren’t playing. Then that’s going to hit their bottom line , it’s going to hit their advertising revenue, and ultimately the market is going to force them to come to the table and make a deal.
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“The PGA Tour is not going to stand by and back permanent or prolonged suspensions of Phil Mickelson, Dustin Johnson, Sergio Garcia. They’re going to back off of these suspensions. It would destroy their brand. It would destroy their business.”
So, at least according to attorneys John Lauro and Jonathan Pollard, the PGA TOUR memo which formally- suspended players is a legally-dubious gesture meant to maintain the TOUR’s pro golf monopoly. We’ll see whether any of the suspended golfers respond with a lawsuit.