A US bankruptcy judge has approved LIV Golf’s bid to reject the contracts of 19 players, including Bryson DeChambeau and Australia’s Cameron Smith, as the league’s lawyer told the court it expects to know by the end of October whether LIV 2.0 goes ahead.
Judge Michael B. Kaplan approved the motion at a hearing in the US Bankruptcy Court in New Jersey on Wednesday (US time), ESPN and BBC Sport reported. LIV said the existing deals “do not reflect the contemplated compensation structure under LIV 2.0”, according to ESPN.
Dustin Johnson and Bubba Watson are also among the 19 players whose contracts were rejected, ESPN’s Mark Schlabach reported. LIV says the step is necessary so it can negotiate new deals with those players for its relaunched league.
Kaplan also approved LIV’s amended restructuring support agreement with BC Partners, which could provide up to US$300 million in financing for LIV 2.0, including an initial US$4 million loan to keep the league running during its Chapter 11 process.
The contract rejections had been adjourned from a hearing the previous week because the players wanted clarity that rejection would allow them to talk to third parties about their futures, BBC Sport reported. Under the restructuring, no player is obliged to be part of LIV going forward.
Read more: Golf: LIV Golf Secures BC Partners Funding for Restructuring
Decision due by the end of October
LIV attorney Rob Fitzgerald, of Gibson Dunn, told Kaplan the two “critical pieces” were the structural side of the BC Partners investment and having a “sufficient number of players to have a bona fide golf league signed up by 25th of this month”, according to BBC Sport.
Asked when he could tell the court whether LIV was going ahead or winding down, Fitzgerald said: “We would anticipate that decision will be made by the end of the month.”
Read more: DP World Tour Shuts Door on LIV Golf Players for 2027
To persuade players to stay, LIV is offering them equity in the revamped league. A term sheet filed with the court sets go-forward ownership at 52.5 per cent for golfers, 45 per cent for BC Partners and potential minority investors, and 2.5 per cent for management, ESPN reported.
LIV hits out at DP World Tour
Fitzgerald also told the court that the DP World Tour’s decision to refuse membership to LIV players next season was a “clear attempt to interfere” with the restructuring and raised anti-competitive concerns.
“We’re continuing to monitor this situation very closely, and we’re quite concerned by it, frankly,” Fitzgerald said, according to ESPN. “Frankly, the timing in particular strikes us as a clear attempt to interfere with our process, with our players, and potentially our reorganization writ large.”
Kaplan replied: “The comments I have read do raise concerns,” BBC Sport reported.
DP World Tour chief executive Guy Kinnings told BBC Sport on Monday that “players need to make a choice”. The tour declined to comment on Fitzgerald’s remarks, the BBC reported. Golfers must apply for DP World Tour membership by 16 November, according to ESPN.
The Australian angle
Smith, the 2022 Open champion, is the most prominent Australian among the players named. ESPN reported that Smith, fellow Australian Marc Leishman and American Harold Varner III had previously asked to be released from their LIV contracts to explore other playing opportunities.
Jon Rahm’s lawyer told the court last week that the two-time major champion would not be part of LIV 2.0, while David Puig and Abraham Ancer are also walking away, according to multiple reports cited by ESPN. BBC Sport reported that LIV owes its players at least US$45 million.
What happens next
LIV needs enough players signed by 25 October and expects to tell the court by the end of the month whether LIV 2.0 will go ahead. The league hopes to complete its court-supervised restructuring in early 2027, BBC Sport reported.
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