Golf Caddies Ask for Mulligan in Suit Over PGA Tour Bib-Ads
On October 12, 2017, golf caddies urged the Ninth Circuit to revive their proposed antitrust class action against PGA Tour Inc. for allegedly exploiting them as walking advertisements. The golf caddies claimed the lower court erred by using evidence outside of their complaint to interpret the contracts and that they had no chance to respond to the court’s arguments.
In their original lawsuit filed by over 80 caddies in February 2015, the caddies alleged that PGA Tour earns $50 million a year from a policy that requires the caddies to wear sponsors on bibs that are so large that they cannot promote endorsement deals of their own on their shirts. The caddies claimed that the PGA Tour agreements do not explicitly require the bibs, thus the mandate they wear the bibs puts PGA Tour in breach of contract. Their suit also alleged that PGA Tour abridged their image rights, violated the Sherman Act by controlling which logos are visible on the TV broadcasts, implied illegally the caddies endorsed the products advertisements on the bibs, and breached California unfair competition law.
In their motion to revive the lawsuit, the caddies’ attorney argued that the trial court made a technical error. The PGA Tour moved to dismiss the complaint based on Rule 12(b)(6), which is a failure to state a claim upon which relief can be granted, but under law the motion cannot include additional evidence without it turning into a Rule 56 summary judgment motion. A summary judgment motion would require the caddies have a reasonable opportunity to refute PGA Tour’s evidence. The caddies’ attorney also argued that the judge discussed two possible contract interpretations, which should have immediately stopped the contract claim survivability discussion. In addition, the caddies’ attorney claimed that the judge discussed details outside of the complaint in making the decision. The judges also struggled with understanding the caddies’ argument, questioning whether the caddies should have instead brought a declaratory judgment action to rule that the caddies would not be in breach of the contract for refusing to wear the bibs. The caddies’ attorney argued the breach of contract claim was valid because PGA Tour was using the contract to make the caddies do something they were not obligated to do under the contract. PGA Tour argued that the bib was just part of the required uniform, which is in the contract.
In February 2016, the district judge dismissed the suit stating that the caddies’ contract was not ambiguous on whether the tour can dictate details about their appearance and that the caddies should have known they would have to wear the bibs given the long history — six decades — of requiring caddies to wear them. The caddies appealed this dismissal.