What happens when a broadcaster just decides to stop paying a league they’ve signed a deal with? The LPGA may soon give us a case in point. That tour is suing Korean company JoongAng Ilbo Co., Ltd., parent of Korean broadcaster JTBC, over unpaid rights fees and sponsorships.
JTBC’s commitments to the tour included underwriting a sponsorship (meaning they paid the tour, but could sell the actual sponsorship to a third party) for the Fir Hills Seri Pak Championship in Los Angeles. That event was set to be played in March before the LPGA cancelled it last month. But they also reportedly haven’t paid any rights fees for 2024 or 2025, leading to the league filing a complaint against them in U.S. federal court. That’s as per a memo from LPGA interim commissioner Liz Moore to players that Golfweek‘s Beth Ann Nichols obtained this week:
In addition to the unpaid bills that canceled the upcoming Fir Hills Seri Pak Championship, JTBC also failed to pay for broadcasting all LPGA events in 2024 and 2025. Golfweek obtained a memo sent out to LPGA players by interim commissioner Liz Moore that outlined further details, including that JTBC had not “engaged meaningfully or provided assurance of payment.”
“To protect our interests, we are filing a complaint to enforce a guarantee agreement with a JTBC affiliate to recover the unpaid amounts,” Moore wrote in a memo sent to players on Feb. 18.
“For now, we are not terminating our agreements and will continue honoring our obligations to avoid disruptions in tournament coverage in Korea. However, if JTBC fails to meet its broadcast commitments, we are prepared to implement alternative solutions.”
As Front Office Sports’ Margaret Fleming noted, JTBC executives have commented on this non-payment:
The broadcaster hasn’t been coy about not paying the tour. According to the Korean outlet Media Today, the CEO of JTBC Plus, Oh Young-min, said in an internal meeting (translated to English from Korean): “In fact, we have been holding out by not paying the PGA and LPGA broadcasting rights fees. We have been working to lower the PGA and LPGA broadcasting rights fees since March and April of this year.” JTBC Plus operates the network’s golf channel.
JTBC Plus and JTBC Discovery announced plans to lay off around 80 employees late last year amid a large deficit, according to Media Today. JTBC Plus also has rights to upcoming World Cups and Olympic Games.
The LPGA previously sued JTBC Plus, which operates the network’s golf channel, in SDNY in 2020 for breach of contract, and voluntarily dismissed it later that year. The PGA sued JTBC Plus in the Southern District of Florida in 2021 over failing to pay $700,000 and ignoring its requests, but reached a settlement the following year.
Of course, there have been other cases of broadcasters not furnishing agreed-on payments. There was some non-payment, at least not at the agreed-upon level, from the then-Bally Sports networks ahead of and then during the complicated bankruptcy of Diamond Sports Group. The 2017 collapse of ONE World Sports also saw some games pulled back around non-payment, and there have been other cases of rights returned when a broadcaster was unwilling or unable to pay. And leagues and companies have also pulled rights from international broadcasters over geopolitical situations.
But the LPGA-JTBC situation is unusual for the continued provision of live events to the company despite the non-payment. It’s also interesting for the complications of this deal, announced in 2009 and struck in 2010, which went beyond just a rights fee to also include sponsorship of events (either as JTBC or through a third-party underwriting deal). And that perhaps speaks to some challenges of striking broadcast deals that also include sponsorship rights.
It sounds like the LPGA will need to find a new Korean broadcast partner (which is quite important, given the success Korean golfers have had on that tour) soon anyway. The JTBC deal only runs through 2025, and the tour is looking for a new partner. And, as we’ve seen with some other past moves, the rights may actually switch sooner than that to avoid a lame-duck period; in this case, that could happen if a deal is struck early and if JTBC still doesn’t pay what they agreed to.
In any case, this will be a situation to watch for the LPGA, impacting not just broadcast rights revenue but also Korean broadcasts and even tournaments.