Jones v. PGA Tour, Inc.

Background

The golfers originally sued PGA Tour, Inc. for alleged antitrust violations and breaches of contract. An amended complaint later added LIV Golf, Inc. as a plaintiff and removed several of the original golfers as plaintiffs.

PGA Tour then filed an answer and one counterclaim against LIV for tortious interference with contract, meaning interference with another party’s contractual relationships. PGA Tour sought permission under Federal Rule of Civil Procedure 15 to amend that counterclaim by adding the Public Investment Fund of the Kingdom of Saudi Arabia and His Excellency Yasir Othman Al-Rumayyan as counter-defendants. LIV opposed the motion.

Arguments

PGA Tour argued that information produced during discovery revealed facts supporting the proposed additions. It also argued that it had not acted in bad faith, had not previously amended the counterclaim, and that the proposed counter-defendants would not suffer undue prejudice. PGA Tour further contended that the proposed amendment was not futile because it adequately alleged tortious interference.

LIV argued that the amendment would be futile because PGA Tour had not alleged the independently wrongful conduct that LIV said was required for interference with an at-will contract. LIV also argued that the proposed amendment targeted conduct protected by the First Amendment. It separately claimed that PGA Tour had delayed, sought to delay trial, and would prejudice the player plaintiffs and LIV.

Court’s analysis

Rule 15 generally requires courts to allow amendments when justice requires. Courts commonly consider five factors, known as the Foman factors: undue delay, bad faith or a dilatory motive, repeated failure to fix pleading defects, undue prejudice, and futility.

The court found that PGA Tour had not unduly delayed because it sought amendment after receiving allegedly supporting discovery. The court found no bad faith or improper motive, and noted that this was PGA Tour’s first proposed amendment to its counterclaim.

The court also found no undue prejudice. LIV had not shown that the amendment would make it unduly difficult to prosecute its case or that PGA Tour had changed its tactics or theories. The court said that LIV’s concern about possible delay was speculative and that LIV had not shown the required prejudice.

Finally, the court found that LIV had not met its heavy burden of showing futility. At this stage, the court could not say that no set of facts could support a valid claim. It concluded that PGA Tour had presented at least a legally arguable claim involving alleged recruitment of players and alleged inducement of breaches of PGA Tour provisions concerning media rights and conflicting event obligations. The court noted that the sufficiency of the claim could receive fuller consideration in a later motion to dismiss.

Disposition

The court GRANTED PGA Tour’s Motion for Leave to Amend Counterclaim to Add Counter-Defendants. It ordered PGA Tour to file the amended counterclaim, with redactions permitted by the court’s order regarding ECF No. 237, by March 3, 2023. The order concerned permission to amend; it did not decide the ultimate merits of the tortious-interference counterclaim.