The future of LIV Golf has a timeline.
During a Chapter 11 bankruptcy hearing in federal court on Wednesday, New Jersey Bankruptcy Court Judge Michael B. Kaplan asked LIV Golf’s attorney when they will know if they are “toggling to clear or if 2.0 is moving forward.” LIV’s lawyer, Robert Fitzgerald of Gibson Dunn, said they “anticipate a decision will be made by the end of the month.”
Wednesday’s hearing was largely procedural in which Kaplan approved the restructuring support agreement (RSA) between LIV Golf and BC Partners Global. The RSA is an important step for LIV, as it looks to survive after the loss of funding from the Saudi Arabian Public Investment Fund (PIF) and reinvent itself as a version 2.0. The deal between LIV and BC Partners Global includes $300 million in cumulative funding to help the league try to start over. The terms sheet calls for the players to receive equity in the league, specifically “52.5 percent ownership” and also to sign bonuses. BC Partners and other potential investors hold 45 percent, and management holds 2.5 percent.
“The approval of (the settlement) is an important step, but it does not necessarily require the confirmation of a plan or the approval of a disclosure statement,” Judge Kaplan explained during Wednesday’s hearing. “In approving (the agreement) the court is not decided on the validity of the claims, except for the limited carveouts for certain sponsor protections, nor any other aspects of a proposed plan.
“This is an important first step in truly identifying viable pathways for the debtor, whether through continuing operations or through a liquidation.”
But while Wednesday’s hearing was mostly procedural, LIV’s lawyers took the time to accuse the DP World Tour of player interference after CEO Guy Kinnings told BBC Sport on Monday that the The European circuit bans golfers from competing on LIV 2.0 by teeing it up on his tour.
“We’re continuing to monitor this situation very closely and we’re quite concerned frankly,” Fitzgerald said of the DP World Tour’s position. “The timing in particular strikes us as a clear attempt to interfere with our process with our players and potentially our reorganization at large.
“It also raises many of the same anti-competitive concerns that LIV has previously expressed regarding the way competing leagues have sought to discourage and punish market participants, namely these players, from participating in LIV and indeed only LIV.”
In previous years, players like Jon Rahm and Tyrrell Hatton received conditional releases that allowed them to play on the DP World Tour and LIV Golf. These releases also helped those players maintain their Ryder Cup eligibility. That will no longer be allowed in 2027 should LIV Golf 2.0 get off the ground.
“Player freedom is the reason LIV Golf was created, and it is the foundation of LIV Golf 2.0, a league built around its players,” Fitzgerald said. “LIV has been vocal in its belief in free agency and that the best players should have greater flexibility to compete throughout the ecosystem. It is unfortunate that another tour takes the opposite view and pressures our players with a false choice.”
Judge Kaplan acknowledged that he had heard Kinnings’ comments and that they “raise concerns.”
On Wednesday, Kaplan also approved LIV Golf’s motion to reject the current contracts of 19 golfers. LIV said the contracts “do not reflect the compensation structure provided for in LIV 2.0.” The list of golfers, which includes Bryson DeChambeau and Dustin Johnson, had previously asked for clarity on whether the rejection of the contract would allow them to have conversations with third parties about their future playing. LIV Golf said that the rejection of these contracts is a necessary step in the restructuring and negotiation of new agreements for version 2.0 of the league.
Last week, Jon Rahm’s lawyer told the court that the two-time major winner do not participate in LIV 2.0 because he found the terms “unacceptable”. David Puig, Abraham Ancer and Adrian Meronk also came out in the past week.
The next hearing in the LIV bankruptcy case is scheduled for October 20. The agreement between LIV Golf and BC Partners set an Oct. 25 deadline for players to commit to LIV Golf 2.0, but allows BC Partners to waive that deadline. Under the RSA between LIV Golf and BC Partners approved on Wednesday, LIV Golf must sign a “requisite number of players”, defined as the number “necessary to ensure the continuity of the business of the Partner Parties as a bona fide golf league”. Simply put, BC Partners now decides whether LIV Golf has earned enough commitments and signed the right players to do business.