Tag: PGA Tour

Update Alert on Mickelson v. PGA Tour, Inc.

On August 16, 2022, we prepared an alert discussing Mickelson v. PGA Tour, Inc. and the claims made by suspended PGA Tour players (“Player Plaintiffs”) against PGA Tour, Inc. (“Tour.”) Quite a bit has transpired in the past three weeks both in and out of the courtroom. This alert highlights new developments that stem from an amended complaint that was filed in the US District Court, Northern District of California on August 26, 2022 (the “Amended Complaint.”)

The Amended Complaint can be found here and the original alert can be found here.

The Amended Complaint removes several Player-Plaintiffs listed as plaintiffs in the original complaint. Originally, the Player Plaintiffs were comprised of the following eleven golfers: Abraham Ancer, Bryson DeChambeau, Taylor Gooch, Matt Jones, Jason Kokrak, Phil Mickelson, Carlos Ortiz, Pat Perez, Ian Poulter, Hudson Swafford, and Peter Uihlein. Per the Amended Complaint, four of the original Plaintiff Players have been removed as plaintiffs, namely: Abraham Ancer, Jason Kokrak, Carlos Ortiz, and Pat Perez.[1] As a result, only seven of the eleven original Player Plaintiffs remain as Player Plaintiffs.

Perhaps the most significant development in the case is that LIV Golf has been added as a Plaintiff in the Amended Complaint. The Amended Complaint generally reiterates allegations made by the Player Plaintiffs (together with LIV Golf, collectively, the “Plaintiffs”) in the original complaint and incorporates LIV Golf’s alleged harm, mainly, that the Tour’s efforts made to prevent LIV Golf’s entry into the elite professional golf market forced LIV Golf to delay and restructure its 2022 launch plans and required LIV Golf “to pay excessively higher guaranteed payments to recruit a number of marquee players than would be required in a competitive market.”

Three more claims were added to the Amended Complaint, for a total of eight claims brought by the Plaintiffs. The first new claim alleges that Tour has violated Section 2 of the Sherman Antitrust Act by monopolizing the market for promotion of elite professional golf events (which is in addition to the Section 2 claim in the original complaint that alleges that the Tour maintains a monopoly on elite event services.) In addition to the now three antitrust claims brought in the Amended Complaint, LIV Golf also brought separate tortious interference claims of contractual relationships and prospective business relationships. The antitrust claims and the tortious interference claims are based on the premise that the Tour’s exclusionary actions: (i) prevent competition for the promotion of golf entertainment among stakeholders, such as broadcasters, players (via the Media Rights Regulation), vendors, sponsors, advertisers, partners, and agencies, and (ii) interfere with LIV Golf’s ability to negotiate and enter into contracts with those stakeholders.

Key Observations

Although more than one-third of the original Player Plaintiffs have withdrawn from Mickelson v. PGA Tour, Inc., the addition of LIV Golf as a plaintiff elevates the lawsuit because it brings the very public rivalry between the Tour and LIV Golf to the courtroom. The circumstances surrounding the case are also rapidly evolving. Since the order denying Player Plaintiffs Talor Gooch, Hudson Swafford, and Matt Jones’s motion for temporary restraining order (“TRO”) issued on August 9, 2022, six Tour members (most notably world number 2 Cameron Smith) have joined LIV Golf, which amounts to nearly half of the major winners since 2016 and 26 of the world’s top 100 golfers that have now signed with LIV Golf. In addition, the Tour announced various rule changes for the 2023 PGA Tour season, including increased purse winnings, bonus pools, and elevated events. It remains to be seen whether these circumstances will materially alter the arguments made throughout the TRO proceedings.

The tentative date to hear dispositive motions (such as summary judgment) has been scheduled for July 23, 2023, and the jury trial date is expected to begin on January 8, 2024.

FOOTNOTES

[1] Pat Perez was the only player who directly provided the reason for his withdrawal: “I didn’t really think it through… I did it to back our guys,” he reportedly said. He also said that he does not have “ill will” towards the Tour and emphasized his content of playing for LIV Golf.

Article By Richard L. Brand, Thomas R. Castiello, Brian D. Schneider, and Anjelica L. Fuccillo of ArentFox Schiff LLP

For more entertainment, art, and sports legal news, click here to visit the National Law Review.

© 2022 ArentFox Schiff LLP

California Court to PGA Tour Caddies: You'll Get Nothing and Like It!

As the full swing of the PGA season rounds the corner, and with the azaleas blooming at Augusta, the trusted confidants of golf’s premier players have already missed the cut.

Last month, the District Court for the Northern District of California dismissed a lawsuit filed against the PGA Tour by a group of 168 caddies contending that the Tour may not require them to wear shoulder-to-thigh length “bibs” during tournaments, many of which feature the name of the golfer for whom the caddie works (on the back) and the names and logos of tournament sponsors (on the front) (Hicks v. PGA Tour, Inc., 2016 WL 928728 (N.D. Cal. Feb. 9, 2016)). Among other arguments, the caddies alleged that the Tour missed the fairway and violated their “right of publicity” by using them as “human billboards” for tournament sponsors without compensation.

California, like many other states, recognizes both a statutory and a common law right of publicity. In California, to state a claim for common law misappropriation in violation of the right of publicity, a plaintiff must allege that defendant used the plaintiff’s name, likeness, or identity without plaintiff’s consent, to the defendant’s advantage, causing harm to plaintiff. The caddies argued that they had never consented to the Tour’s use of their “likeness and images” in connection with the corporate-sponsored bibs during television broadcasts of tournaments. Lawyers for the caddies estimated the value of chest-front advertising on caddie bibs at $50 million per Tour season, of which the caddies received no cut.

U.S. District Judge Vince Chhabria dismissed the caddies’ lawsuit last month with prejudice, writing that “(t)he caddies’ overall complaint about poor treatment by the Tour has merit, but this federal lawsuit about bibs does not.” The court’s ruling relied heavily on the contract that each caddie must sign with the Tour to work an event. The form contract provides that “(c)addies shall wear uniforms…as prescribed by the host tournament and the PGA TOUR,” but does not explicitly require a caddie to wear a tournament bib. The caddies argued that the contract’s particular silence as to bibs precludes the Tour from requiring the caddies to wear the advertisement-laden smocks between the ropes. As a matter of contract interpretation, Judge Chhabria cited the general rule that even where disputed contract language appears ambiguous, the ambiguity can be resolved as a matter of law where context reveals that the language is susceptible to only one interpretation. The court found context in the caddies’ own admission that the Tour has required them to wear bibs for decades as the primary part of their “uniform.” Therefore, concluded Judge Chhabria, the only reasonable interpretation of the contract is that caddies agreed the Tour could make them wear bibs.

Resting upon this interpretation of the Tour contract, the court ruled that the critical element in the caddies’ right of publicity violation claim was not satisfied, namely, a lack of consent. Because the court interpreted the caddie contract as requiring the caddies to wear bibs, and when read with a provision of the contract whereby caddies assign to the Tour their “individual television, radio, motion picture, photographic, electronic … and all other similar or related media rights” with respect to their participation in Tour events, the court concluded that the caddies consented to the use of their images at tournaments, including any logo on the bibs. Thus, tapping in an easy two-foot putt, the court dismissed the caddies’ claim relating to the right control the commercial use of their likenesses.

Even if the district court’s decision is upheld on appeal, all is not lost. Caddies still possess a long game and can always individually negotiate with sponsors to endorse products and place advertisements on other highly visible parts of the uniform, such as hats and shirt sleeves. Further, the court apparently did find some merit in the caddies’ allegations of poor treatment by the Tour, which may earn them a few strokes in the court of public opinion. So, they got that going for them, which is nice.

Article By Litigation Practice Group of Proskauer Rose LLP

© 2016 Proskauer Rose LLP.

California Court to PGA Tour Caddies: You’ll Get Nothing and Like It!

As the full swing of the PGA season rounds the corner, and with the azaleas blooming at Augusta, the trusted confidants of golf’s premier players have already missed the cut.

Last month, the District Court for the Northern District of California dismissed a lawsuit filed against the PGA Tour by a group of 168 caddies contending that the Tour may not require them to wear shoulder-to-thigh length “bibs” during tournaments, many of which feature the name of the golfer for whom the caddie works (on the back) and the names and logos of tournament sponsors (on the front) (Hicks v. PGA Tour, Inc., 2016 WL 928728 (N.D. Cal. Feb. 9, 2016)). Among other arguments, the caddies alleged that the Tour missed the fairway and violated their “right of publicity” by using them as “human billboards” for tournament sponsors without compensation.

California, like many other states, recognizes both a statutory and a common law right of publicity. In California, to state a claim for common law misappropriation in violation of the right of publicity, a plaintiff must allege that defendant used the plaintiff’s name, likeness, or identity without plaintiff’s consent, to the defendant’s advantage, causing harm to plaintiff. The caddies argued that they had never consented to the Tour’s use of their “likeness and images” in connection with the corporate-sponsored bibs during television broadcasts of tournaments. Lawyers for the caddies estimated the value of chest-front advertising on caddie bibs at $50 million per Tour season, of which the caddies received no cut.

U.S. District Judge Vince Chhabria dismissed the caddies’ lawsuit last month with prejudice, writing that “(t)he caddies’ overall complaint about poor treatment by the Tour has merit, but this federal lawsuit about bibs does not.” The court’s ruling relied heavily on the contract that each caddie must sign with the Tour to work an event. The form contract provides that “(c)addies shall wear uniforms…as prescribed by the host tournament and the PGA TOUR,” but does not explicitly require a caddie to wear a tournament bib. The caddies argued that the contract’s particular silence as to bibs precludes the Tour from requiring the caddies to wear the advertisement-laden smocks between the ropes. As a matter of contract interpretation, Judge Chhabria cited the general rule that even where disputed contract language appears ambiguous, the ambiguity can be resolved as a matter of law where context reveals that the language is susceptible to only one interpretation. The court found context in the caddies’ own admission that the Tour has required them to wear bibs for decades as the primary part of their “uniform.” Therefore, concluded Judge Chhabria, the only reasonable interpretation of the contract is that caddies agreed the Tour could make them wear bibs.

Resting upon this interpretation of the Tour contract, the court ruled that the critical element in the caddies’ right of publicity violation claim was not satisfied, namely, a lack of consent. Because the court interpreted the caddie contract as requiring the caddies to wear bibs, and when read with a provision of the contract whereby caddies assign to the Tour their “individual television, radio, motion picture, photographic, electronic … and all other similar or related media rights” with respect to their participation in Tour events, the court concluded that the caddies consented to the use of their images at tournaments, including any logo on the bibs. Thus, tapping in an easy two-foot putt, the court dismissed the caddies’ claim relating to the right control the commercial use of their likenesses.

Even if the district court’s decision is upheld on appeal, all is not lost. Caddies still possess a long game and can always individually negotiate with sponsors to endorse products and place advertisements on other highly visible parts of the uniform, such as hats and shirt sleeves. Further, the court apparently did find some merit in the caddies’ allegations of poor treatment by the Tour, which may earn them a few strokes in the court of public opinion. So, they got that going for them, which is nice.

Article By Litigation Practice Group of Proskauer Rose LLP

© 2016 Proskauer Rose LLP.