Image via Star Tribune
In the week leading up to the inaugural round of the controversial LIV tournament at the Centurion Golf Club outside London, Phil Mickelson became the largest name to date to join the ranks of the tournament, with rumors swirling around Bryson DeChambeau, Patrick Reed, and Rickie Fowler joining later this week. While a number of PGA members have resigned from the Association to join the ranks of the Saudi financed LIV tour, Mickelson’s announcement is notable because he became the first golfer to announce his plans to participate in LIV play while still remaining a member of the PGA—mounting a public challenge to the defensive rhetoric the Association has promulgated to players and the public regarding their newfound competition.
The PGA has enjoyed a “monopoly” on professional golf for decades, so understandably the thought of a well-financed, ready-to-compete startup tournament turns their business model on its head and threatens both their bottom line and their prestigious reputation. The PGA was unprepared for the possibility of competition and was caught off guard when the LIV tour began poaching talent. As a result, the PGA is attempting to bar its members from participating in the LIV tournament by warning of “consequences” for joining their newfound rivals. This poses a multitude of anti-trust and employment law questions that the PGA seems to be ignoring as they try to find a way to stop the LIV before it gets out of the tee box.
Professional sports in the United States are, let’s face it, businesses. They are all enterprises that are ultimately designed to make the most money possible, despite what we as fans like to think, or however leagues attempt to convince us otherwise. As businesses, all professional sports leagues in the U.S. are subject to anti-trust laws (excluding the MLB, which was, wildly, given an exemption in 1922) and are not permitted to act as monopolies by smothering competition to “protect” themselves. This is the reason the NBA had the ABA, the NFL had the AFL, etc.—they couldn’t “stop” these leagues, and had to eventually merge to survive. By openly opposing the LIV tour and stating publicly that there will be “consequences” for members that try to either leave the PGA or try to participate in both, the PGA is running the real risk of ending up in the foul ground of federal anti-trust regulation. The PGA may be able to say that golfers who participate in the LIV tournament are ineligible to play in the PGA without implicating anti-trust regulation—they could argue that it is only logical that players in one league preclude themselves from participating in the other based on precedent from the above-mentioned examples—but threatening “consequences” is almost inviting a player like Mickelson to bring an anti-trust action against the Association, where they stand a high probability of being left in the rough.
The other issue with the PGA threatening “consequences” to players for joining the LIV is the fact that golfers are not employees of the PGA—instead, they are independent contractors. By labeling their athletes as independent contractors, the PGA saves millions in taxes and benefits, but in their fight against players participating in the LIV, this is likely going to handicap them. Generally, independent contractors are just that—independent individuals that are contractors. This means that while they service or work for one organization, there is no legal limitation that would keep them from having the ability to choose to contract with another company or business whenever they see fit, and one business cannot prohibit them from exercising this right. If a business wants the right to prohibit working for the competition or to limit an employee’s ability to leave and go to a competing company, you’re going to have to label them as an employee.
Why does this matter for the PGA? Well, as independent contractors, golfers have this freedom of contract, and the PGA can’t “punish” the athletes for choosing to exercise this freedom. The fact that they have threatened to punish the members that do leave or attempt to participate in both tournaments, when taken to court, will likely weigh heavily towards a finding that the PGA is actually treating their “independent contractors” as employees. This mislabeling has massive consequences beyond just leaving PGA members able to play golf with the LIV tournament—if it’s found that the PGA is treating golfers as employees instead of independent contractors, they are going to be in some hot water with the federal government for wage law violations, tax fraud, unemployment and overtime violations, failure to provide benefits, and many other violations of law. Without considering the damage lawsuits like this would have on the impeccable and “shiny” reputation the PGA has spent years curating, these violations are going to lead to major forced changes to the way the PGA operates that would be undesirable, not to mention probable jail time for those individuals involved.
With all that is at risk here, why is the PGA still making these public declarations, and risking coming under this level of legal scrutiny? Well, they are terrified of what this means for their bottom line. As I mentioned before, the PGA has enjoyed an unprecedented period of non-competition. The fact that the LIV Tour has essentially unlimited resources and is able to immediately poach talent and interest from the PGA in its first year of existence has the Association on the back foot, trying to land any punches it can to slow down the LIV’s growth. You can’t blame them for being reluctant to let go of their monopoly on professional golf and the profits that come with that, but if they aren’t careful, they could easily find themselves in a bunker they won’t be able to chip themselves out of.
How the PGA handles itself moving forward in the next few months could be pivotal for the future of the PGA and professional golf in general, and I for one am interested to see exactly what becomes of this tense and controversial rivalry.
Zachary Bryson is a graduate from Wake Forest University with B.A. in Economics and a Minor in Entrepreneurship. He is now a JD candidate at Elon University School of Law, Class of 2023.