Report: Justice Department Notifies PGA Tour of Plan to Review Alliance With LIV Golf’s Backer

A review could lead to uncertainty over the proposed deal or delay its completion.
Report: Justice Department Notifies PGA Tour of Plan to Review Alliance With LIV Golf’s Backer
Report: Justice Department Notifies PGA Tour of Plan to Review Alliance With LIV Golf’s Backer /

The Department of Justice has notified the PGA Tour that it will review its plans to form a partnership with the DP World Tour and the Public Investment Fund of Saudi Arabia to determine whether it violates antitrust law, according to The Wall Street Journal.

The newspaper cited “people familiar with the matter,” which could lead to uncertainty over the proposed venture, possibly pushing into the future the commencement of any deal the sides make.

PGA Tour commissioner Jay Monahan has referred to it as "the framework of a deal" and acknowledged that many aspects of the plan need to be settled.

“We are confident that once all stakeholders learn more about how the PGA Tour will lead this new venture, they will understand how it benefits our players, fans, and sport while protecting the American institution of golf,” the Tour said in a statement Thursday evening.

The Justice Department was already investigating the PGA Tour for anticompetitive behavior due to its fight with LIV Golf.

According to the newspaper, one senior Tour executive told employees that the full outcome of the proposal announced next week won’t likely be known for at least a year, with regulatory review possibly extending beyond that.

Yasir Al-Rumayyan, the governor of the PIF, had suggested in a television interview last week that the time frame would be considerably shorter.

LIV Golf has been a disruptive force in the game for more than a year, luring players to the new circuit with huge up-front signing bonuses and $25 million purses in every tournament with guaranteed pay because there are no cuts.

The PGA Tour has enforced stiff penalties for anyone participating in LIV events, and the DP World Tour won an arbitration case in April that allows it to enforce its fines and suspensions for players who played in conflicting events.

Last week’s announcement was supposed to foster peace, with litigation between the sides being dropped. Monahan appeared in a CNBC interview alongside Al-Rumayyan, who is also a hands-on overseer of LIV Golf.

Since that time, PGA Tour policy board member Jimmy Dunne has conducted several interviews in which he promoted the benefits of the deal for the PGA Tour. The PIF has said nothing since the announcement, and there have been no public comments from LIV Golf, although a source and several LIV players have suggested to Sports Illustrated that they’ve been told the league will proceed for at least this year and next.

Under the announced agreement, the PGA Tour’s 501(c)(6) nonprofit entity—the PGA Tour as we know it with a schedule of events throughout the year—will remain intact. A 2024 schedule is expected to be announced within weeks.

What is unclear is how the new for-profit LLC being called NewCo will operate. Al-Rumayyan will be the chairman of a board that consists of Monahan as CEO and other representatives from the PGA Tour. An evaluation of the assets of the three principles is to take place.


Published
Bob Harig
BOB HARIG

Bob Harig is a senior writer covering golf for Sports Illustrated. He has more than 25 years experience on the beat, including 15 at ESPN. Harig is a regular guest on Sirius XM PGA Tour Radio and has written two books, "DRIVE: The Lasting Legacy of Tiger Woods" and "Tiger and Phil: Golf's Most Fascinating Rivalry." He graduated from Indiana University where he earned an Evans Scholarship, named in honor of the great amateur golfer Charles (Chick) Evans Jr. Harig, a former president of the Golf Writers Association of America, lives in Clearwater, Fla.