PGA Tour and LIV Golf Spar Over Saudi Ties in Subpoena Battle
The extent to which the PGA Tour’s legal battle with LIV Golf is about Saudi Arabia plays a starring role in new court filings.
On Nov. 22, attorneys representing the Public Investment Fund of the Kingdom of Saudi Arabia (PIF) and its governor, Yasir Othman Al-Rumayyan, moved to quash PGA Tour subpoenas that would require Al-Rumayyan to testify at depositions and to turn over sensitive documents. The PGA Tour, PIF charges, intends to “burden” Al-Rumayyan with “unnecessary” requests as part of an effort to frame the dispute as more about the Saudi Arabian government than two golf leagues.
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Much of PIF’s argument before California federal judge Beth Lasbon Freeman is based on the Foreign Sovereign Immunities Act (FSIA). This federal law generally makes foreign governments and leaders immune from lawsuits in U.S. courts. However, under FSIA’s “commercial activity” exception, a government and leader can face trial if a lawsuit is based on their regular course of commercial conduct and if there is a sufficient connection between that conduct and the U.S.
The PGA Tour maintains that PIF effectively controls LIV Golf and thus is subject to litigation and discovery requests. But PIF insists the commercial activity exception doesn’t apply because—as PIF attorneys tell it—the two leagues’ antitrust and contract claims have “nothing to do with PIF.”
To that end, PIF works hard to distinguish LIV from PIF, which was created by royal decree in 1971 to serve the public interest and promote “economic development in the Kingdom.” PIF objects to the tour’s use of the verb “control” since, PIF asserts, the fund doesn’t control LIV’s “day-to-day operations.” PIF admits that it recently opened an office in New York City but contends “the office has a skeletal crew and leases office space … PIF has no real estate or employees in the U.S.”
PIF maintains that it would set a “dangerous precedent” if it could be “sued in U.S. courts any time one of its portfolio companies is involved in a dispute.” Around $40 billion of PIF’s $676 billion in assets are held in U.S. public companies, including Meta, Starbucks, Amazon, Microsoft and Walmart. Many of those companies, PIF notes, “are involved in antitrust lawsuits.”
As for Al-Rumayyan, PIF concedes he “sometimes” travels to the U.S. for business but insists “he does not travel to New York or California in connection with LIV.” In a sworn declaration, Al-Rumayyan describes himself as a government minister and argues he only has access to documents sought by the PGA Tour “by virtue of my position as an official of the government.”
Judge Freeman will take the arguments under advisement and issue a ruling. She’ll be inclined to deny PIF’s motion if she believes PIF and Al-Rumayyan are sufficiently connected to LIV for purposes of the legal claims raised by each side.
Unless the two sides reach a settlement, the case is a long way from resolution. A trial date is scheduled for Jan. 8, 2024, and any verdict could be appealed to the Ninth Circuit.
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