Jack Nicklaus Defamation Lawsuit Over LIV Golf Kept in Court
A Florida appellate court on Wednesday held that Jack Nicklaus' defamation lawsuit against businessman Howard Milstein and Nicklaus Companies LLC for comments related to Nicklaus and LIV Golf is not barred by a contractual forum selection clause.
Nicklaus and Milstein have battled each other in New York and Florida courts over the aftermath of a multi-document, $145 million transaction in 2007.
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At the time, Nicklaus sold the company GBI Investors to Milstein in a deal that gave rise to Nicklaus Companies. GBI Investors had licensed Nicklaus' intellectual property—including his NIL and trademarks—and oversaw his golf course design business. The transaction contained four agreements (purchase and sale; limited liability company or LLC; noncompete; and employment) and each contained forum selections, with New York or Florida listed as the applicable state.
The relationship between Nicklaus and Milstein eventually soured. The two disagreed about business matters, including the extent to which, and under which circumstances, Nicklaus could license his IP to golf tournaments and other projects. In 2022, Nicklaus resigned from Nicklaus Companies' board.
That same year Nicklaus Companies sued GBI Investors and Nicklaus in New York for breach of contract, tortious interference and related claims. In March a judge held that Nicklaus preserved licensing authority for his NIL, including for deals related to golf course design. Nicklaus Companies, however, owns certain trademarks connected to its licensing, golf course design and several brands, including Golden Bear™ and Jack Nicklaus™. New York litigation involving these parties remains on the docket.
In the Florida case, Nicklaus is the plaintiff. He argues the defendants defamed him in statements that 'went viral around the world and tarnished his reputation.' The statements concerned Nicklaus meeting with representatives of Golf Saudi in 2021 for the design of a Jack Nicklaus Signature course in Saudi Arabia. At the time, Saudi Golf was planning LIV Golf and eyed Nicklaus for a leadership role. As Nicklaus tells it, he rebuffed Golf Saudi's overtures because he knew it would prove problematic with the PGA Tour, an organization that is directly connected to his legacy as winner of a record 18 major championships. He also insists Milstein and Nicklaus Companies played no meaningful role in his decision.
Nicklaus argues that Nicklaus Companies defamed him by claiming Milstein and company officials saved him from moving forward with Golf Saudi. Nicklaus also contends that Nicklaus Companies suggested to clients and others that Nicklaus, 85, was exhibiting signs of dementia and 'needed to have his car keys taken away.'
Whether Nicklaus can prove defamation remains to be seen, but a contract-based forum clause defense for Nicklaus Companies won't end the case.
Writing for himself and Judges Dorian K. Damoorgian and Ed Artau, Judge Spencer D. Levine affirmed a trial court's denial of Nicklaus Companies' motion to dismiss based on language in an LLC agreement in 2007. The agreement stated that disputes over 'any action or proceeding arising out of or relating to this agreement' are heard in New York.
Nicklaus Companies asserts that Nicklaus' defamation case is tied to statements and allegations made in the company's lawsuit in New York and are connected to the LLC agreement.
Levine disagreed. He wrote the LLC agreement does not apply to alleged defamation.
'No nexus existed,' the judge explained, 'between the defamation claim and the LLC agreement.'
Levine explained that the LLC agreement concerned such business topics as 'organizational matters; capital, capital accounts, and members; distributions; allocations of net profits and net losses; operations; interests and transfers of interests; and dissolution, liquidation, and termination of the Company as well as buy-out rights.' Those subjects, Levine reasoned, contrast with Nicklaus accusing the defendants of making 'false statements relating to Nickalus and the new Saudi golf league.' The Saudi matter is 'wholly independent from the LLC agreement.'
The Florida case involving Nicklaus will thus continue.
In a statement shared with Sportico, a spokesperson for Nicklaus Companies stressed the appellate court 'did not rule on any issue of fact in favor of one party or another' and instead ruled on where a trial would be held. The spokesperson also mentioned that the Florida court previously 'denied Mr. Nicklaus's motion for punitive damages.'
As Nicklaus Companies tells it, the complaint the company filed in New York 'was never given to any reporter, and the facts show the goal was always to minimize public attention while the rights of the parties were properly determined by the New York court,' and no one at the company defamed Nicklaus.
'We maintain the greatest respect for Mr. Nicklaus's legacy and have always hoped to work with him again in some capacity,' the spokesperson said. 'We still hold that hope. In the meantime, we are confident the jury will agree with our position once all the evidence is presented in court.'
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