During a contentious court hearing conducted via Zoom on Friday, U.S. District Judge Beth Labson Freeman denied the PGA Tour’s request to delay the Jan. 8, 2024, start for its trial against LIV Golf. However, she implied the date would be postponed if the Public Investment Fund of the Kingdom of Saudi Arabia (PIF) and its governor, Yasir Othman Al-Rumayyan, delay compliance with subpoenas.
LIV Golf firmly opposed a delay, claiming that the PGA Tour is inflicting ongoing harm on elite pro golfers through its alleged monopolistic control of the market for their services.
On behalf of LIV Golf, attorney John Quinn told Freeman that golfers “have a limited time to play” at the highest level, so a delay would exacerbate career harm. Quinn also described LIV, which is funded by a $676 billion entity (PIF), as a “startup” with “only a certain window of opportunity” to succeed. “This business only works,” Quinn maintained, if LIV Golf “can recruit” elite golfers, some of whom he said have been “blackballed” by the PGA Tour. “There is a need for urgency,” he insisted.
The PGA Tour and its attorneys see the situation differently. Attorney Elliot Peters stressed that the three remaining LIV player-plaintiffs (Matt Jones, Bryson DeChambeau and Peter Uihlein) “have been paid a king’s ransom” to play for LIV and thus, he said, aren’t being harmed. In pleadings, the PGA Tour has underscored that LIV golfers are being paid more than they would earn on the PGA Tour. Freeman sided with the PGA Tour on that issue in a decision last August. Peters also complained that PIF and Al-Rumayyan have “erected every single barrier [possible]” to challenge the ability of the PGA Tour to question them under oath.
Freeman expressed frustration with LIV Golf for seeking an expedited schedule while PIF and Al-Rumayyan have tried to steer clear of the litigation. “I have 400 other cases,” she warned LIV’s attorneys. “Each of the litigants in the other 399 cases believes their case is at least as important as you believe your case is. I don’t know how many times you expect me to give priority to this case.”
The hearing also revealed fundamental disagreements about the intensity of the relationship between LIV, PIF and the Saudi government.
Freeman grilled Peters on why PIF and Al-Rumayyan are so necessary for the PGA Tour to defend against LIV’s antitrust arguments. Peters referred to PIF and LIV Golf as intricately connected, saying “PIF” and “its shell corporation, LIV Golf” are engaged in “a struggle between these two golf leagues or tours or however you want to describe them.”
Peters insisted that Al-Rumayyan has been deeply involved in the negotiations, approval and funding of contracts between LIV and golfers. Peters went so far as to say that “a lot of LIV executives report to Mr. Al-Rumayyan” and “communicate” with him on a continuous basis, and that “a lot of people have left LIV,” so Al-Rumayyan has become the most knowledgeable person left to answer questions. Peters further contended that LIV Golf uses similar competition restrictions as the PGA Tour, and thus Al-Rumayyan’s testimony “is highly relevant” to determining the market for pro golfers and whether, under antitrust scrutiny, the PGA Tour has acted reasonably or unreasonably.
Quinn took offense to Peters’ characterizations, saying, “With all due respect, what PIF or Mr. Al-Rumayyan has to say has nothing to do with the definition of the market we are talking about … the market for elite golf.”
Quinn went on to offer a limiting view of PIF and Al-Rumayyan as they relate to PIF. He called PIF a mere “investor” in “a new entrant in the market where the Tour is a monopolist … LIV is the entrant, not PIF.” Quinn also rejected Peters’ portrayals of LIV as a de facto shell of PIF. “LIV Golf is a separate entity,” adding, “there are multiple layers” of corporations “standing between them; they are not one and the same.” Quinn also dismissed the frequency of Al-Rumayyan’s discussions with LIV Golf as ordinary and expected for “an investor in a new startup.”
On balance, Freeman seemed more sympathetic to Peters’ view, saying that Al-Rumayyan “is in up to his eyeballs in everything LIV has done” and thus has potential evidence. She also said, “I think it is ludicrous” to suggest Al-Rumayyan and PIF are not involved with LIV.
The parties don’t even agree on who is a defendant.
Last night, the PGA Tour filed an amended complaint against LIV, naming PIF and Al-Rumayyan as defendants. An attorney for PIF and Al-Rumayyan contends the complaint hasn’t been served on her clients and thus they aren’t defendants, but Peters argued an electronic filing counts as service. Freeman declined to weigh in. As of this writing, PIF and Al-Rumayyan are nonparties but that is subject to change once they are served (if they haven’t already been served).
Whether PIF and Al-Rumayyan are nonparties or defendants is an important point, since it impacts the legal consequences of them not complying with a subpoena and other litigation-related obligations. As of now, the PGA Tour would need to travel to Saudi Arabia to question Al-Rumayyan and would have limited ways to compel him to the U.S. But if Al-Rumayyan is a defendant and he then refuses to appear, the court would be more inclined to dismiss LIV’s case or side with the PGA Tour on its counterclaims for tortious interference and inducing breach of contract. The PGA Tour has filed a motion requesting that Al-Rumayyan must travel to the U.S. to answer questions under oath.
Meanwhile, Freeman addressed a request on Thursday by the Kingdom of Saudi Arabia to file an amicus brief regarding U.S. Magistrate Judge Susan van Keulen allowing the PGA Tour to subpoena PIF and Al-Rumayyan. Freeman criticized the Kingdom as being “behind the game here” and now trying to “make up for it.” Freeman said the Kingdom should have voiced an opinion before van Kuelen ruled. When an attorney for PIF and Al-Rumayyan suggested the Kingdom wasn’t carefully monitoring the U.S. litigation, Freeman shot back, “You’re telling me PIF doesn’t communicate with the Kingdom, I thought they were part of the sovereignty?”
The growing list of parties and nonparties involved in the litigation will be filing briefs over the next month. Freeman has scheduled another conference hearing for April 7 at 1 p.m. PD T. If the two sides are unable to advance their pretrial discovery at a pace that would permit a trial next January, expect that date to be pushed back.