The golf world was shocked this week when former world number one Dustin Johnson publicly revealed his resignation from the PGA Tour.

DJ, as he is known, is not the only player to join the controversial Saudi funded LIV-Golf tour. Well known players such as Phil Mickelson, Ian Poulter, Sergio Garcia and Lee Westwood teed off at Centurion Club in London, LIV Golf’s maiden event. Not only does this make headlines on the sports pages, but it also throws up some legal questions around issues such as governance, competition and sponsorship.”

So, why the controversy?

LIV Golf is the new kid on the block. Players that have committed to LIV Golf have been suspended by the PGA Tour. PGA Tour players will not be able to play on the LIV Golf tour, leaving players with an important decision to make – the perceived monetary benefit and all things new or the lasting legacy of the PGA Tour.

Golf governance is a complicated business. There are a variety of different professional tours, all organised by different bodies for players to compete in. Historically, golfers have had the freedom to play where they choose, most commonly on the European Tour (known as the DP World Tour), run by the PGA European Tour or the PGA Tour. Generally, the world’s elite have chose to play the majority of their golf on the PGA Tour. The PGA Tour itself has been in existence since 1929. Buoyed on by golf icons like Arnold Palmer, Jack Niklaus and Tiger Woods, the PGA Tour is recognised for having the highest purses and greatest prestige. PGA Tour players are considered members and adhere to strict governance regulations, the PGA Tour Player Handbook and Tournament Regulations.

Are there any legal issues?

The Regulations are vast. They make clear that each PGA Tour member recognises the tour’s policy board and the appeals committee have the authority to permanently ban a member from playing in a tour sponsored, approved or coordinated tournament if the member violates the Regulations. A player ceases to be a member of the PGA Tour if, in the opinion of the PGA Tour’s board, a serious breach of the Regulations has been committed or a member otherwise conducts themself in a manner unbecoming of a professional golfer. Any conflicting-event tours without the PGA Tour’s permission are also denied - any player in breach of the Regulations will face sanctions, as is the case with the LIV Golf.

In essence, the PGA Tour, as an entity has the discretion to enact rules of conduct of its members and employees to be adhered to. That said, speculation has mounted regarding potential litigation-based challenges on behalf of the players and LIV Golf against the PGA Tour.

Centrally, it’s difficult to reconcile free competition and the sanctions the PGA Tour is placing on tour players. Competition law is a vast topic, but as a general rule, no one entity is allowed to monopolise the market, thereby thwarting healthy competition. Albeit not covered in great detail here, challenges based on competition are not new to the PGA Tour – since the mid-90s the Federal Trade Commission, the US-government agency whose principal mission is the enforcement of civil U.S. antitrust law (the equivalent of the Competition and Markets Authority in the UK) has kept a watchful eye on the PGA Tour. Indeed, ex-pro Greg Norman, who is leading the LIV Golf challenge, put on record that “lawyers at the PGA Tour must be holding their breath…for decades, I have fought for the rights of players to enjoy a career in which they are rewarded fully and properly for their efforts.”

The impact on a player’s sponsorship is an issue likely to crop up too – whether such sponsorship is exclusively for specific tours and how the seemingly negative reputational impact players suffer could affect sponsor’s interests.

Where next?

We’ll be sure to find out in time. There is certainly no love lost between the PGA Tour and LIV Golf. Jay Monahan, the PGA Tour Commissioner, has stated on record that “These players have made their choice for their own financial-based reasons.” Rory McIlroy, a long time supported of the PGA Tour echoed the Monahan’s view, suggesting LIV Golf is “boatloads of cash and it's money up front. I get it and for some guys that's really enticing.” The LIV Golf response? Simply, amongst other comment, “this is the era of free agency.”

There also remain questions over whether the PGA Tour’s sanctions might stretch to player’s competing in golf’s top events, the four majors – the Open, the Masters, the US Open and the US PGA. The USGA, who run the US Open, made clear that those competing in the LIV Golf events would be allowed to play in the US Open, but the statement remained open insofar as the USGA reserves the right for this to change.

Looking ahead, it’s not beyond the realms of possibility that the PGA Tour and LIV Golf co-exist. To not go into the governance structure of golf in great detail, events organised by different entities already do co-exist. For example, not all of the majors are governed by the PGA Tour, nor are previous Saudi-backed events. Indeed, the format of the LIV Golf series is unique and offers a seemingly modern approach – free broadcasting online, shorter events, more fan-involvement and team-based competition. Such reasons have led to debate on whether the controversy is borne out of turf-protection and attempts to lessen the threat from a rival more lucrative tour by the PGA Tour. You only have to look at the sums being offered to players to understand the lure.

Undoubtedly the success of LIV Golf depends on how many of world’s elite opt in – the greater the number, the greater the pressure on the PGA Tour. How this unfolds will undoubtedly shape the landscape of world golf. As a golf fan, I am intrigued to see where this all goes.

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