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THE PGA DROPPED COUNTRY CLUB APPROACH IN FTC FIGHT
Published October 24, 1995
The recent FTC investigation of the PGA Tour and the initial decision by the FTC's antitrust lawyers to take governmental action against the Tour was examined in Sunday's L.A. TIMES business section. In late 1994, the FTC decided to take try to nullify two little-known PGA Tour rules that all members must agree to as a condition of joining the Tour. One of the rules forbade golfers to play in a non-PGA event without approval of the commissioner. The other mandates the commissioner have final say on TV appearances. In addressing the FTC's investigation, PGA Tour Commissioner Tim Finchem abandoned the traditional "low key" approach of the Tour for a "more vigorous, frontal counterattack." Finchem sold the idea to Congress that "while the tour's disputed politics control players, the restraints are necessary to assure TV networks and sponsors of a reliable supply of quality golfers." Finchem took several avenues, one of which induced tournament sponsors and charities to write members of Congress and the FTC, while also directly pleading the Tour's case with Congress. VULNERABILITY: The TIMES' David Willman calls the results an example of "how vulnerable the FTC is to political pressure," as no fewer than 26 members of Congress wrote to FTC commissioners about the case. Willman points out that as many as 20 members of Congress are invited to play with PGA stars in the Kemper Open Pro-Am. As this was going on, legislation approved by a Senate subcommittee threatened to slash FTC funding by 20%, something that was "a factor in their decision," according to Terry Moorhouse, Exec VP and General Counsel of the PGA Tour. The FTC, after several months of congressional lobbying to back off, voted on September 1 to kill the investigation, and according to Willman, "congressional overtures injected a tension that could not be ignored." One unnamed FTC official told the TIMES that the letters and input from Congress "were taken very seriously" (L.A. TIMES, 10/22).