Saudi LIV Golfers File Antitrust Action Against PGA Tour

Members of One Conspiracy in Restraint of Trade Sue Another Conspiracy in Restraint of Trade to Get Benefits from Both

They say you cannot have your cake and eat it too. Well those former PGA Tour professional golfers who became paid employees of Saudi LIV Golf, where they get paid at least $100,000 per tournament, as Woody Allen said, by just showing up, have now sued the PGA Tour claiming it is interfering with their ability to earn money by barring them from PGA Tour events. Of course, they resigned from the PGA Tour and were told before they resigned that they would not be eligible for PGA Tour events before they signed as employees of Saudi LIV Golf. This is humorous since the lawsuit has members of one conspiracy in restraint of trade suing the other conspiracy in restraint of trade from which they resigned claiming the Sherman Act entitles them to benefits from the PGA Tour from which they resigned. I hope the Saudi golfers paid very hefty retainers to their lawyers as I predict the Saudi LIV people will not be happy with the result.

Also, if the Saudi LIV golfers think they will obtain quick relief by a TRO or preliminary injunction, they must be kidding themselves or their lawyers are kidding them. The lawsuit raises complex issues, and I doubt there has ever been similar litigation between members of an organized sport league against another organized sport league. from which they voluntarily resigned.

I do know what a real conspiracy in restraint of trade looks like as I witnessed one in formation when I worked as a teenager after school at my father’s truck and industrial parts company in Chicago. One day at the end of work, my father said he needed to go to an evening meeting and I could go along. The meeting was held in the back room of Mama Batt’s Restaurant at 22nd and Michigan in a building known as the New Michigan Hotel where Al Capone lived from 1928 to 1931 and was the scene of Geraldo Rivera’s 1986 live TV program of opening a vault in the basement used by Al Capone, but Geraldo after much hype, found nothing: an empty basement vault probably cleaned out years previously when J Edgar Hoover ran the FBI along with his “friend.” So, what was the purpose of this meeting: a trucking company had signed deals with various manufacturers of truck parts giving them direct purchasing from the manufacturers of the truck parts. This would eliminate the business of all the wholesalers, jobbers etc who had substantial businesses selling truck parts to trucking companies. So, everyone at this meeting was a competitor of the others, but they all greeted each other with warm expressions of friendliness as though they were all family. After our Jewish deli dinner, we got to the business. People expressed outrage that this trucking company by getting direct parts from manufacturers would put them out of business. So, finally a motion was made and seconded that all of the parts suppliers would withhold business of any kind for the trucking company. This meant if the trucking company had an emergency and needed a parts delivery, every Chicago area supplier told them they could not help them out. Needless, to say this had a devastating impact on the trucking company as they could not repair disabled trucks.

What happened? The boycott of the trucking company was very effective, and after two weeks they cancelled all of their direct purchase contracts. The parts suppliers won including my father. So, the lesson is a well-organized boycott can generate immediate positive results. Did it violate the Sherman Act, probably. But it was so effective and cured the problem that there was no follow-up governmental investigation. But this was Chicago in the 1950s.

Now returning to the Sherman Act and professional golf, I do not think the Saudi LIV golfers have much of a case. They would be well-advised to withdraw their case before their lawyers get rich on their failure.

It would be better if the Saudi LIV golfers paid charities rather than their lawyers who in my opinion gave them bad advice.