What’s the legal side of the PGA/LIV merger?

Main story, breaking story, as we started the program today, and I am Adam Gold. This is Victoria, and we are here for you every day here on the Adam Gold show, from Wilmington all the way out to Asheville, Greenville, we're everywhere, was that the PGA Tour and live golf and the DP World Tour announced what amounts to a merger which came as a shock.

To the PGA Tour players, and I always hear that they are the tour, but apparently not for this purpose because they found out one minute before everybody else did through a basically a text alert to their phones wherever they get their news and I thought that there was a problem maybe five days ago, but we'll talk about this with John Nucci. We've talked to John before, I believe he joins us. He is the chief golf law correspondent at Conduct Detrimental, the podcast. We talk to Daniel Wallach or Dan Lust all the time. John Nucci, how are you my friend? I appreciate your time. I'm doing well, Adam.

Thank you for having me. Alright, so make sense, in a legal sense, in your mind of what we just saw happen today. So, it's hard to, I mean, it's difficult to make sense of it because it's pretty stunning. I don't think many people saw this coming at all. I know that it was kept secret, as you mentioned, at the very highest levels. I heard Rory just found out about it about a moment before it happened. Yeah.

I know that same with Greg Norman. So, it'll be very interesting to see what comes of this. I would note that in Commissioner Jay Monahan's letter to the players, he made a comment that it would have to be approved by the PGA Tour policy board. I looked up the policy board, the current composition of it. It includes five players out of 11, which includes Rory McElroy. So, given the level of hostility and backlash that we're seeing from players on Twitter, that is, I would imagine at least five out of 11 no votes. So, I mean, if they get one more, who knows? But I guess maybe there's a mechanism to push it through. Otherwise, I don't know what the voting requirements are, but certainly a lot of details here to hire now.

All right. So, five days ago, USA Today published a story that was entitled, CEO says Endeavor considered one billion dollar investment in LivGolf that would have replaced Saudi Arabia as, I guess, the chief fund backer of that tour. And Endeavor has, you know, they're involved in sports entertainment, wrestling, UFC, IMG. So, they're obviously a major player in sports, and they are also a sponsor of PGA Tour. They're a contributor and a backer of PGA Tour events. And Ari Emanuel, the CEO of the PGA Tour, basically said that the PGA Tour told them not to do it. How does, how did this kind of tip the antitrust scales against the PGA Tour, if this turns out to be true? So, yeah, I thought that when I first read that comment that essentially PGA Tour Commissioner Jay Monahan asked not to, and they didn't because of that. That is something that a Department of Justice antitrust investigation is, I mean, those are the type of exact type of conversations that they're looking for.

So, that was pretty shocking. I am actually interested, I've seen a lot of people say that this may have been the precursor for these discussions, but I think that they may have opened up a whole new can of worms on the antitrust side because same thing happened when the NBA and ABA merged back in the 70s, I believe it was the 70s, and Oscar Robinson and others filed an antitrust lawsuit because at that point there was one singular dominant source for professional basketball. And I think we're just about to see the same thing. So, they, you know, this merger may have settled their concerns about maybe Pitt being subject to discovery and sitting for depositions and everybody opening their books in long litigation, but it may have also just opened up a whole other antitrust can of worms that will play out over the next couple of years or so. See, because the way I look at this, and you tell me I'm wrong, you're the attorney, you're the golf law expert for conduct detrimental.

Again, we talked to Dan Wallach a lot, and congratulations, he and his wife had a baby not that long ago, and Dan lost as well. But I thought that the PGA Tour's position prior to this story wasn't terrible, but I thought that when I saw this story, to me, five days later, maybe it's just a coincidence, five days later without the players really knowing about it, you would think as much as they carried the water for the tour over the last 18 months, especially Rory McIlroy, you would think that they would have had some heads up. I just, I can't help but think that there is a correlation to this story and where we are today. Each week we dive into the mind of the con artist, uncovering the secrets behind the biggest Ponzi schemes you've never heard about. We're not talking about Bernie Madoff or Charles Ponzi.

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Subscribe to the Ponzi playbook wherever you get your podcasts. So I agree with you. I thought the PGA Tour was in a great spot as far as the litigation goes. I think the public investment fund being on the verge of having to be subject to discovery and open up their books and have their officials sit for depositions maybe accelerated the fire a little bit on whatever merger talks there may have been. I will also say that I saw reports that they were actually not planning on announcing this today and that they got news pretty late that it was going to leak. So they made the decision to come out and just kind of announce it a little bit of a spur of the moment.

So we're getting also some interesting details about what might be the corporate structure that are coming out too. So I think this is going to open up for sure an antitrust investigation, especially if the players are as angry as they seem to be on Twitter. And I can't say I blame them for that given how they've, as you mentioned, kind of carried the torch and now basically have just been stabbed in the back. At least they feel a little bit by the PGA Tour.

Careful John Nucci from Conduct Detrimental. I don't think we can say stabbed in the back with regards to any relationship between Liv and the PGA Tour. There are other things that we also probably can't say, so I'm not going to. When you read the PGA Tour release today, I assume you did, as I did. People were asking me questions about it.

I'm like, I haven't even had a chance to read it yet. Were there details that you were hoping to see in the tour's release that weren't there? Not necessarily. I was hoping to see maybe a little bit more of an explanation of how this can benefit the players, maybe an explanation of what happens to Liv player contracts. I think the biggest issue is all of these guys that went to Liv, they got hundreds of million dollars in contracts.

I don't know what happens to those contracts. I saw reports that they would have to pay fines in order to come back and play in PGA Tour events. That leads me to believe that maybe they are going to operate two independent tours and just interchange players. I think it was a little light on details, but that may have been because, as I mentioned, I think they got a little bit blindsided by the fact that the news was going to leak out. They wanted to get out ahead of it, and maybe it's a little light on the details for that reason.

Doesn't it feel like this whole thing was just thrown together at the end? We don't know how many events. We don't know when the events are going to be. We don't know where the events are going to be. We don't know what they're going to look like. We don't know who's going to be eligible to play. Ultimately, we're talking about golf tournaments.

We have created this new entity, but nobody knows what the entity is going to look like, and there wasn't even a suggestion as to what it might look like. It just seems to me that the golf part of this is going to be figured out down the road, and that to me shows something that was just kind of thrown together at the last minute. I couldn't agree more, yeah. It seems a little bit disorganized, and maybe that's the reason why, but it's unbelievable to me that the players that passed over, I know Hideki, I think, had a massive offer for upwards of two or three hundred million dollars that he turned down. I don't know that maybe just fines on players that want to come back is going to save players that stayed loyal throughout this whole time. Another little interesting wrinkle to this, I wouldn't necessarily be surprised if we see some type of, and I don't really know how this would play out, but if we see some type of players union with professional golf, if there is just some, you know, everything is controlled by a single entity now.

So that's another little something to look for. Yeah, Hideki Matsuyama turned down a big offer, and he would have been an absolute star. They would have had events in Japan, and Tom Kim, who was a superstar at the end of last season, has not had a good season this year. Man, he could have gone too and made boatloads of money. And I mean, they're all making great money anyway.

Nobody has to hold a benefit for any of these guys. John Nucci, Conduct Detrimental is the podcast. He is the chief golf law correspondent at JNucci23 on Twitter. Hey, thank you very much for jumping on. I appreciate your time. Thank you, Adam. Take care. If someone you love is struggling with their mental health, you don't have to struggle alone. Call or text 988 to get resources and support from trained crisis counselors who can help you help them 988-Suicide-in-Crisis-Lifeline. Hope has a new number.