Representatives of the PGA Tour, LIV Golf and Saudi Arabia’s Public Investment Fund have been invited by Sens. Richard Blumenthal (D-CT) and Ron Johnson (R-WI) to testify at a July hearing related to the recent landmark agreement between the parties after an extensive power-struggle in professional golf. The hearing, scheduled for July 11 in Washington, D.C., intends to gather more information concerning the framework of the deal and its potential ramifications.
“Our goal is to uncover the facts about what went into the PGA Tour’s deal with the Saudi Public Investment Fund and what the Saudi takeover means for the future of this cherished American institution and our national interest,” Blumenthal said in Wednesday’s release. “Americans deserve to know what the structure and governance of this new entity will be. Major actors in the deal are best positioned to provide this information, and they owe Congress – and the American people – answers in a public setting.”
Individual invitations were sent to PGA Tour commissioner Jay Monahan, LIV Golf CEO Greg Norman and PIF governor Yasir Al-Rumayyan. Each letter requested the individuals be prepared to discuss “the anticipated role of the PIF in U.S. professional golf.” Monahan is currently away from his day-to-day duties as he recovers from an undisclosed medical situation.
Blumenthal serves as the chair of U.S. Senate Permanent Subcommittee on Investigations, of which Johnson is a ranking member. Blumenthal opened an investigation into the agreement and requested documentation from the PGA Tour and Monahan to determine the legality of the deal, which ended ongoing litigation between the two parties.
The PGA Tour was reportedly $50 million in the hole with legal fees, and the agreement quickly provided relief from such spending. Monahan said an inability to compete financially with the PIF was a significant factor in the deal materializing. It came at at time when the U.S. Department of Justice was already investigating the PGA Tour for its antitrust practices.
Blumenthal is seeking to review the following documentation:
- Records relating to the relationship between the PGA Tour and LIV Golf not limited to the agreement
- Records relating to the relationship between the PGA Tour and Saudi Arabia’s PIF, including communication between any representatives
- Records relating to the new agreement and all records related to the “new, collectively owned, for-profit entity”
- Communication between PGA Tour commissioner, PGA Tour Board of Directors, PGA Tour Player Advisory Council and/or PGA Tour executive leadership concerning LIV Golf
- Records relating to any dispute between PGA Tour and PIF, LIV Golf, Jay Monahan or Yasir Al-Rumayyan
- Records relating to PGA Tour’s tax-exempt status under 510(c)(6) of the Internal Revenue Code
- Records produced in response to any investigation by law enforcement regarding the agreement, PGA Tour’s communication with LIV Golf or PIF and PGA Tour’s tax-exempt status
- Organizational charts and those made for the new entity
Many legal experts have cited the 1914 Clayton Act as a potential speed bump this deal will need to roll through. The Clayton Act aims to regulate business practices and prohibits anticompetitive mergers and acquisitions.
Blumenthal, in a statement soon after the agreement was announced, criticized the PGA Tour for its reversal of stance after “lambasting Saudi sports-washing and paying lip service [to] the integrity of the sport of golf” and vowed to “keep a close eye on the structure of this deal and its implications.”
Where this deal ultimately goes remains to be seen, though Golf Channel reported Tuesday that it contains safeguards to ensure the PGA Tour maintains leadership of both the new entity and its existing circuit. The PGA Tour, which held a players meeting Tuesday night in Connecticut prior to the Travelers Championship, intends to make that a point of emphasis in an effort to rekindle trust with its membership.