LIV Golf's Bankruptcy and the Player-Owned Restart

Timeline

1. 2021LIV Golf is founded with PIF backing.
2. Jan 12, 2026The PGA Tour opens a one-time Returning Member Program for recent major and Players winners.
3. Apr 30, 2026PIF says it will stop funding LIV after the 2026 season; LIV appoints an independent board.
4. Sep 8, 2026LIV files for Chapter 11 and signs a restructuring support agreement with BC Partners Credit.
5. Oct 5, 2026LIV files an amended agreement with BC Partners, including a $300 million investment and 52.5% player ownership.
6. Oct 2026The DP World Tour says LIV players will not get dual membership in 2027.
7. Oct 14, 2026The bankruptcy court approves the amended agreement; 19 more player contracts are rejected.
8. Oct 25, 2026Deadline (extendable by BC Partners) to sign enough players for LIV 2.0.

The ethical issues

• Obligations of state-funded leagues to athletes and staff.
• Sportswashing and the sustainability of state investment.
• Player ownership as a governance model.
• Rival tours' membership rules and player freedom.
• Use of bankruptcy to reject contracts.

Stakeholders

Stakeholder	Interests & obligations
LIV players	Payment owed, future earnings and playing options.
LIV staff and vendors	Jobs and payments.
PIF	Its investment strategy and reputation.
BC Partners and new investors	Returns on financing.
PGA Tour and DP World Tour	Protecting their tours.
Host venues and fans	Events and commitments honored.

The case

LIV Golf’s founding and its battle and talks with the PGA Tour are covered in LIV Golf, Saudi Arabia’s PIF and the PGA Tour. This case covers what happened when the money stopped, and what a league built on one state investor’s money owed the players, staff and partners who relied on it.

Background

LIV launched in 2021, co-founded by Yasir Al-Rumayyan, governor of Saudi Arabia’s Public Investment Fund (PIF), who became its most powerful figure.^[1] The BBC reported that PIF’s overall investment surpassed $5 billion, including $267 million of fresh capital in 2026. Net losses outside the US alone exceeded $1.1 billion since 2021, and overall losses were likely to “run to several billion dollars.”^[1]

By early 2026, the path back to the established tours had narrowed. On January 12, 2026, the PGA Tour created a one-time Returning Member Program for players who had played in “Unauthorized Tournaments,” had been away at least two years and had won a major or The Players Championship from 2022 to 2025. Returning players had to accept “severe yet appropriate financial consequences,” including losing equity grants under the tour’s Player Equity Program for five years.^[7] The BBC reported that Jon Rahm, Cameron Smith and Bryson DeChambeau turned down the offer and that Brooks Koepka was the only player to accept.^[1]

On April 30, 2026, PIF said the “substantial investment” LIV required over the long term was “no longer consistent with the current phase of PIF’s investment strategy,” while praising its “transformational and positive impact.”^[1] Al-Rumayyan stepped down from the board. LIV appointed an independent board led by Gene Davis and Jon Zinman, restructuring specialists, to find new investors, and the BBC reported that the series was “totally up for sale.”^[1]

The rules and governance

Chapter 11 of the US Bankruptcy Code lets a company keep operating while it reorganizes under court supervision. A debtor can reject burdensome contracts, and a reorganization plan must win creditor votes and be shown to be feasible.^[5] On September 8, 2026, LIV filed in the US Bankruptcy Court for the District of New Jersey and signed a restructuring support agreement with BC Partners Credit. Under the agreement, the reorganized league would be “majority owned by players.” PIF agreed to provide $49.6 million in debtor-in-possession financing, subject to court approval. LIV said it intended to emerge in early 2027 and would seek recognition of the case in England and Wales.^[2] CEO Scott O’Neil called it “an innovative, player-first ownership model.”^[2]

The restructuring

On October 5, LIV filed an amended agreement. Golf Channel reported that BC Partners would invest $300 million in a scaled-back “LIV Golf 2.0” with 10 events in 2027. According to the term sheet, “go-forward player ownership will equal 52.5 percent,” with 45 percent for BC Partners and minority investors and 2.5 percent for management. Players would also receive signing bonuses and “certain NIL rights.” The term sheet required new contracts with “players required by BC Partners,” leaving the investor to decide what “critical mass” meant.^[5][6]

On October 14, Judge Michael B. Kaplan approved the agreement, cautioning that approval did not decide “the validity of claims” or the eventual plan. “This is an important first step in order to really identify viable paths for the debtor, either through continuing operations or a wind-down,” he said.^[6] He also approved LIV’s motion rejecting the contracts of 19 players, including DeChambeau and Dustin Johnson. Golf Channel called that a standard bankruptcy step.^[6] The BBC reported that LIV owes its players at least $45 million.^[3] The approvals let LIV rehire staff and sign course agreements.^[4]

Rival tours

The DP World Tour said it would refuse membership to anyone playing LIV the next season. Its CEO, Guy Kinnings, said “players need to make a choice.”^[3] LIV’s attorney told the court the timing was “a clear attempt to interfere with our process with our players” and raised “anti-competitive concerns” about competing tours seeking to “box out and punish” players.^[4][6] Judge Kaplan said the comments “do raise concerns.”^[3][6] Rory McIlroy said the tour was “well within their rights.”^[3]

Aftermath

As of mid-October 2026, LIV needed enough players signed by October 25 for a “bona fide golf league,” though BC Partners could extend or waive the deadline. Its attorney said a decision on whether to proceed or wind down would come by the end of the month.^[3][4] Jon Rahm, Abraham Ancer and others said they would not return, while Richard Bland said he would play.^[4] The next hearing was set for October 20.^[4][6]

What the filings show

The court papers give a fuller picture of the economics. In his first-day declaration, chief restructuring officer David Orlofsky said entities controlled by PIF had invested “approximately $5 billion in equity capital” since 2021. He said LIV “ran at a loss for all years of operations,” with about $5 billion in net operating losses across its two main entities as of December 31, 2025.^[8] Sponsorship was its largest revenue source, about 49% of 2025 revenue, rising from about $16 million in 2023 to $102 million in 2025. Tournament hosting fees made up 22%, ticketing and hospitality 16%, and broadcasting rights only about 5%.^[8] The company said it had secured about $300 million in sponsorship contracts for 2027 through 2029.^[8] After sending legally required layoff notices on July 8, 2026, it made deep workforce cuts in early September and was left with 41 employees, 22 in the US and 19 in the UK.^[8]

The petition’s list of the 30 largest unsecured creditors shows who stood to lose. Most of the top entries were players’ participation agreements: about $7.47 million for Jon Rahm’s entity, $5.77 million for Bryson DeChambeau’s and $5.49 million for Dustin Johnson’s, followed by Cameron Smith, Adrian Meronk and others.^[9] The list also includes event and media vendors, the State of Louisiana, the Asian Tour, and a $1.72 million grant agreement with the UN High Commissioner for Refugees.^[9] Golf Digest reported that BC Partners has ties to GSE Worldwide, an agency that represents a sizable portion of LIV’s players and also appears on the creditor list.^[9][10]

By October 21, four days before the deadline, which had already been pushed back two weeks, Golf Digest counted just four players publicly committed to LIV 2.0: Richard Bland, Cameron Tringale, Brendan Steele and Ben Campbell. DeChambeau had indicated support and met potential investors.^[10] Louis Oosthuizen became the latest to leave, saying his “biggest fear was that the schedule on LIV 2.0 would be tough to manage.” Golf Digest reported that the language of the player benchmark in recent court filings had become “ambiguous,” and that players still with LIV had until November 16 to apply for DP World Tour membership.^[10]

The core dilemma

Players joined LIV for guaranteed money, accepting reputational and career costs. When its state backer withdrew, LIV used bankruptcy to reject contracts and proposed giving players ownership. What does a league owe the athletes it recruited, and is player ownership a genuine remedy?

Competing values

• Contract obligations vs. business survival.
• Player empowerment vs. shifting risk to players.
• Tour loyalty vs. player freedom.
• Investor discretion vs. responsibilities to stakeholders.

Strongest arguments

For the restructuring: it offers a path to survival and gives players ownership and control. Bankruptcy is a lawful mechanism to reorganize.

Critics’ view: players are owed money and face uncertainty; ownership may mean taking on risk the funder walked away from.

On rival tours: they argue they protect their membership; LIV argues they punish players.

Applying the frameworks

Justice

A justice lens asks whether players, staff and vendors are treated fairly when a funder withdraws, and whether losses are shared fairly.

Care ethics

A care lens focuses on the relationships and dependencies created when players left established tours, and what responsibilities follow.

Utilitarianism

A utilitarian lens weighs the benefits of keeping a league alive against the costs to creditors and the wider golf ecosystem.

Walk it through: the Simple Decision Model

1. Spot the issue. You are a LIV player deciding whether to join LIV 2.0. Stakeholders include your family, teammates and tours. Less visible are staff and vendors. The codes are the bankruptcy process and tour rules.
2. Gather facts. What financing and ownership terms are offered? Beware assuming ownership means security.
3. Test options. (a) Join LIV 2.0. (b) Seek a return to another tour. (c) Wait for the outcome.
4. Check codes and law. Check contract rejection effects and tour membership rules.
5. Decide and document. Record your reasoning and financial advice.
6. Communicate and follow up. Inform teammates and sponsors.

What’s settled and what’s contested

• Settled: the PIF withdrawal, the Chapter 11 filing, the BC Partners agreement and contract rejections.
• Contested: whether LIV 2.0 will proceed; whether players will be paid what they are owed; whether rival tours’ rules are fair.

Why this case matters

LIV’s collapse tests the durability of state-funded sports ventures and offers an unusual experiment in player ownership.

Key terms

Sportswashing

Using sport, through events, teams or sponsorship, to improve the reputation of a state or company and distract from wrongdoing.

Stakeholders

Everyone with something at stake in a decision: athletes, coaches, parents, officials, fans, employees, sponsors, media, communities and regulators, including the less visible ones.

Commercialization

The process of turning sport into a product and a business enterprise, with profit pressures that can compete with principle.

Moral hazard

When someone takes more risk because others will bear the cost.

Agency

An athlete’s ability to make decisions and act independently about their body, career and voice.

Definitions from the Ethics Cases glossary.

Discussion questions

1. What did LIV and PIF owe players who joined, given the reputational costs they faced?
2. Is a player-majority-owned league a genuine improvement in athlete power, or a way to shift risk to players?
3. Is the DP World Tour's refusal of dual membership fair business protection or an attempt to punish players?
4. What does LIV's collapse suggest about sportswashing-funded ventures?

Sources

1. Saudi Arabia to stop funding LIV Golf next season — BBC Sport
2. LIV Golf takes strategic action to secure its next era — LIV Golf
3. LIV accuses DP World Tour of player 'interference' — BBC Sport
4. LIV gets key approvals in bankruptcy court — Sports Business Journal
5. LIV Golf, BC Partners file restructuring support agreement in bankruptcy case (Oct. 6, 2026) — Golf Channel
6. Judge approves agreement between LIV Golf and BC Partners (Oct. 14, 2026) — Golf Channel
7. How it works: PGA TOUR Returning Member Program (Jan. 12, 2026) — PGA Tour
8. Declaration of David Orlofsky, Chief Restructuring Officer, in support of Chapter 11 petitions and first day motions, In re LIV Golf, No. 26-20189 (MBK) (Bankr. D.N.J. Sept. 9, 2026) — U.S. Bankruptcy Court, District of New Jersey (via Omni Agent Solutions)
9. Voluntary Petition (Doc. 1), including list of 30 largest unsecured creditors, In re LIV Golf, No. 26-20189 (Bankr. D.N.J. Sept. 8, 2026) — U.S. Bankruptcy Court, District of New Jersey (via CourtListener)
10. Another major champ leaves LIV Golf; just four players publicly committed to league days before deadline (Oct. 21, 2026) — Golf Digest