Lynch: Lawyer up! The PGA Tour is about to be legally forced to prioritize fans over players

A little after 10 a.m. Thursday morning, employees at the PGA Tour’s GloHo learned during a town hall meeting that the principle of scarcity articulated by their new CEO has wide-reaching implications. One month into the job, Brian Rolapp announced a voluntary retirement program for staff who lack the commitment, stomach or alignment for the imminent era of sweeping change. Between 5 and 10 percent of the Tour’s 1,300-odd employees will be eligible. Executives closer to the top of the greasy pole won’t be impacted, most having negotiated gold-plated parachutes to be deployed when their seat on the company jet is reassigned.

Personnel changes are part of Rolapp’s effort to reallocate resources to new priorities, but this first salvo is more than just practical housekeeping. It’s a calculated gesture to the Tour’s two centers of power.

Strategic Sports Group, which invested $1.5 billion in the Tour last year, is convinced that headquarters is overstaffed, overpaid and overspending—and not without cause, to be fair. Annual tax filings show numerous suits and pantsuits in Ponte Vedra whose compensation would represent a decent finish on the money list if they actually played for a living. Efficiencies in that quarter will buy Rolapp both time and goodwill among the whiz kids of Greater Fenway, and perhaps even reduce the frequency of calls from Andy Cohen, SSG’s most meddlesome member.

The other message Rolapp sent was to the locker room, and it signaled that the pain will be shared. Most Tour members co-sign SSG’s sentiments about profligacy at HQ, but even the least attentive player must by now realize that their cull is coming too. Tiger Woods also addressed Thursday’s town hall about the mission of the Future Competition Committee, the panel Rolapp installed him to chair as it conducts a root and branch review of the Tour’s entire business model. That process promises radical reform of an organization that functions more like a paternalistic trade association than a cutthroat sports league.

There will be fewer exempt players, and they’ll find it tougher to keep making a lucrative living on comparatively mediocre performances. There will be fewer tournaments, particularly of the variety that feel more local than national in profile. There will be fewer financial commitments that divert funds from the core business, which should have PGA Tour Champions guys sweating their substantial subsidy. Scarcity can reduce dilution of the product, encourage fan anticipation and elevate the stature of events. But it clearly means some folks making themselves scarce too, and not just workers at the GloHo.

Whatever savings Rolapp sees from the staff buy-out might wisely be reinvested in hiring legal counsel to attend every meeting of Tiger’s committee, because the Tour is wading into an antitrust minefield that it is culturally ill-suited to survive without proper guidance.

Jodi Balsam, a professor of sports law at Brooklyn Law School, points to the example of the ATP Tour. Two decades ago, the ATP announced a “Brave New World” strategy to boost the popularity of men’s professional tennis by bringing more top players to an upper tier of prestigious events, which would then lead to increased revenue from ticket sales, sponsorship and media rights. The ATP anticipated litigation and it was not disappointed.

The owners of a tournament in Hamburg, Germany, filed an antitrust suit in 2007 after the ATP lowered the status of the clay court event and moved it from May, when it was a prime lead-in stop to the French Open. Plaintiffs claimed the ATP Tour was making it impossible for them to attract top player talent by reducing their status, prize money and ranking points. An adverse judgement risked bankrupting the ATP, but in 2008 a jury found in their favor, a verdict affirmed two years later by the U.S. Third Circuit Court of Appeals.

Documents unearthed in the discovery process proved that the ATP’s focus was not on monopolizing the market for elite tennis stars, as the Hamburg plaintiffs alleged, nor even on the enrichment of the tour or its players. From the outset, the ATP’s “Brave New World” plan was designed around delivering the best possible product to consumers—the very constituency antitrust laws are intended to protect. That explicit, documented intent saved the circuit from ruin and stands as a lesson for the PGA Tour.

“The blunt force weapon of antitrust will most certainly be wielded against any contraction or restructuring of the PGA Tour,” Professor Balsam said. “Working from the ATP Tour playbook, the PGA Tour should focus the committee’s efforts on making the Tour more competitive with other spectator sports and entertainment products. That would shore up the decisive antitrust issue—that the focus is trained on consumer benefit.”

As Rolapp attempts to manufacture scarcity in men’s professional golf, there’s obvious potential for aggrieved factions to emerge as tournaments are eliminated, sponsors jettisoned, players relegated and charities squeezed. The Tour faces enormous exposure if any future plaintiff can prove that decisions were made to intentionally benefit preferred tournaments, sponsors, executives or players.

The endgame for Rolapp must be to give golf fans the best experience possible. That in itself represents a profound mindset shift for an organization that has historically prioritized the wants of its members over the needs of its consumers. The PGA Tour is initiating a process in which finally putting fans first is actually a legally necessary strategy.

This article originally appeared on Golfweek: PGA Tour is about to be legally forced to prioritize fans over players