In 1976, the Saudis wanted American television. A Saudi Conglomerate almost purchased the Corporate Communications of America, (CCA), the parent of the television news network, UBS. What stopped the deal? Telegrams. With the help of an UBS news anchor by the name of Howard Beale, Americans displayed their moral outcry by sending 6 million telegrams to the White House stopping the deal.
Well, at least it was true in the 4-time Oscar-winning film, "The Network."
Howard was America’s mad prophet. He claimed to see the face of God and had borne witness to the moral light of ultimate clarity. He could see right from wrong, whereas everyone else only saw a moral gray. After stopping the deal, Howard was summoned by the CEO of CCA, Arthur Jetsen, into a conference room called Valhalla (The Fallen). Howard’s moral principles were no match for Mr. Jetsen who declared, “There are no Nations,” “the world is a college of corporations,” and “there is only the international system of currency.” Howard’s moral principles were ineffective against Jensen’s corporate view. How can you argue about what’s good or bad for America when your opponent denies America itself?
In 2023, the Saudis want sports. The Saudi Public Investment Fund will be the sole sponsor of the PGA Tour and the Qatar Investment Authority bought 5% in the parent, Monumental Sports & Entertainment, which owns the Washington Wizards, Capitals, and Mystics. Except for some angry golfers, Americans have not marched in the streets nor have they called the White House 6 million times.
How do you challenge sovereign foreign investment? Depends on the sports organization.
The first solution is adding reverse morals clauses to the collective bargaining agreements such as the NBA, NFL, MLB, NHL, and MLS. A morals clause is a common contract provision in an athlete’s sponsorship contract where the contract can be suspended or terminated based on an athlete’s conduct disrupting the party’s reputation or image. A reverse morals clause is a rare provision where an athlete has the power to suspend or terminate the contract based on the party’s conduct disrupting the athlete’s reputation or image. Reversal morals clauses are nothing new to sports. See Cari Grieb’s 2015 article[1] on reverse morals clauses and Donald Sterling and the law firm, Miller Canfield, 2017 article on athletes using reciprocal morals clauses in their endorsement deals.[2] Future players of the Wizards, Capitals, and Mystics should negotiate for these clauses in their new player deals given Qatar’s 5% investment into their teams. A reverse morals clause would protect an athlete’s brand in the event that Qatar’s conduct damages their image.
Who would use a reverse morals clause?
Two NBA candidates may be Kyle Kuzma and Jordan Poole. Since Kyle Kuzma signed his 4-year $102 million dollar contract on June 30, 8 days after Qatar bought a 5% stake on June 22nd, it’s unlikely that Mr. Kuzma could argue that Qatar’s investment harmed his brand. However, Jordan Poole originally signed his contract with the Golden State Warriors and was traded to the Wizards on the same day as the Qatar deal closed on June 22nd. If Mr. Poole had a reverse morals clause and believed that Qatar’s involvement with the team disrupted his reputation, then Mr. Poole could exercise his right to suspend the contract temporarily until he is traded to a different team.
Sports organizations without a CBA like the PGA Tour require a different solution. The PGA Tour is a non-profit organization where the players are independent contractors without a union. As a result, reverse morals clauses could not be utilized. Furthermore, the PGA’s bylaws grant the Commissioner broad powers to enter into contracts without player approval. This problem dates back to 1983 when Jack Nicklaus, Arnold Palmer, and Tom Watson failed to defeat their PGA Commissioner, Dean Beman, over player rights and marketing strategies analogous to Phil Mickelson’s current complaints about the PGA.[3] Other than changing the PGA’s bylaws to limit the commissioner’s powers and creating a union, the best available solution is the deep pocket theory.
In tort law, the deep pocket theory states that a defendant must pay even without causing harm when (a) the victim is truly innocent and highly sympathetic, (b) the injuries are severe; (c) the true wrongdoer is unavailable, and (d) the risk of harm was arguably foreseeable to the defendant.[4] This theory can be adapted to contracts where the party with the deeper pockets must overpay. PIF has not caused direct harm to Rory McElroy and other loyal PGA players, however, they have caused harm to American groups. Since the loyal PGA players are highly sympathetic parties, the PGA should dig deep into PIF’s pockets to make the sports washing so thorough that it becomes almost punitive. The PGA would be smart to require the following of PIF:
- Pay money to the estate of Jamal Khashoggi including funding journalism scholarships in his name at Saudi and American Universities,
- Pay money to families impacted by 9/11,
- Consistently fund LGBTQ+ organizations in America and women’s rights and education organizations in Saudi Arabia, and
- Sizable contributions to the LGPA Tour if their players approve.
In this way, the loyal PGA players would have stayed as true to their moral principles given their options.
John Camacho is a graduate of South Texas College of Law where he earned a J.D. and a graduate of the University of Missouri, St. Louis where he received a M.A. in Philosophy. He is also a Co-Founder of The Moral Questions of Sports. He can be reached via Instagram, @themoralquestionsofsports.
Sources:
[1] Cari Grieb, “A ‘Sterling’ need for reverse morals clauses in sports contracts,” Mar 9, 2015, https://www.millercanfield.com/resources-Should-Athletes-Demand-Morals-Clauses-in-Contracts.html. [2] Miller Canfield, “Is it Time for Athletes to Demand Reciprocal Morals Clauses in Their Endorsement Deals?” Feb. 17, 2017, https://www.millercanfield.com/resources-Should-Athletes-Demand-Morals-Clauses-in-Contracts.html. [3] Shane Ryan, “The 1983 Rebellion: Our latest podcast revisits pro golf’s original crisis” Golf Digest, https://www.golfdigest.com/story/1983-rebellion [4] Victor E. Schwartz, Phil Goldberg, and Christopher E. Appel, “Deep Pocket Jurisprudence: Where Tort Law Should Draw the Line” (2018) Oklahoma Law Review Vol. 70 Number 2, page 404, https://digitalcommons.law.ou.edu/cgi/viewcontent.cgi?article=1319&context=olr.
