Saudi Arabia’s golf case threatens to spill kingdom secrets
WASHINGTON –
Officials who oversee Saudi Arabia’s tens of billions of {dollars} in U.S. investments have not been shy about flaunting their ties with high American business and political figures, right down to carrying MAGA caps as they swing golf golf equipment alongside former president Donald Trump. But they have been silent about most of the particulars of those relationships.
That’s altering on account of a federal lawsuit in California pitting the Saudi-owned golf tour upstart LIV in opposition to the PGA Tour. A decide, citing what she described as the dominion’s hands-on administration of LIV, discovered that when it got here to the brand new golf league, Saudi officers and the Saudi authorities aren’t shielded from U.S. courts the way in which sovereign nations often are.
While Saudi Arabia is combating the choice, insisting U.S. courts don’t have any jurisdiction over its excessive officers, the ruling means legal professionals for the PGA Tour would have the ability to query high officers about business secrets and techniques that the Saudis have held shut, resembling particulars of deal-making involving 2024 presidential candidate Trump and others.
U.S. District Judge Beth Labson Freeman discovered that the Saudis had smacked up in opposition to a industrial exception to U.S. legal guidelines on sovereign immunity.
Yasir al Rumayyan, appointed below Crown Prince Mohammed bin Salman to handle the oil-rich Saudi authorities’s US$600 billion-plus stockpile of wealth, is “up to his eyeballs” in managing the golf tour, Labson Freeman declared.
The discovering follows PGA Tour claims that al Rumayyan himself recruited LIV gamers, authorised LIV contracts and was in any other case the golf league’s decision-maker and supervisor. Lawyers for Saudi Arabia counter that Rumayyan’s actions have been these of an keen investor, not of somebody truly working a business.
The case issues past the world of golf. Saudi Arabia has been assertive in U.S. business investments and political relationships and will now face courtroom calls for for larger transparency and accountability.
The insistence by Saudi officers that U.S. courts have little or no say over their actions is particularly delicate. Last yr, the dominion, with authorized backing from the Biden administration, efficiently argued that American courts had no authority to attempt the prince in a lawsuit over the 2018 killing of U.S.-based journalist Jamal Khashoggi. U.S. intelligence officers had concluded that aides and different Saudi officers despatched by the prince killed Khashoggi. The slaying has opened a long-lasting rift between the Biden administration and Prince Mohammed, Saudi Arabia’s de facto ruler.
Longstanding worldwide legislation typically protects the leaders and authorities of 1 nation from being hauled into one other nation’s courts. Congress carved out industrial exercise as an exception to that sovereign immunity in 1976.
The PGA Tour argued in a submitting Friday that Saudi Arabia and its sovereign wealth fund below the prince have a document of flip-flopping on insisting upon sovereign immunity, relying on whether or not doing so works to their benefit in numerous business offers and lawsuits.
Saudi Arabia’s critics and unbiased authorized consultants and analysts say the dominion could also be in a troublesome spot legally.
“It seemed to me very clear that it wasn’t immune” from U.S. courts when it got here to working the LIV golf tour and tournaments, mentioned Donald Baker, a lawyer and a former head within the U.S. Justice Department’s antitrust division who will not be concerned within the case.
Baker projected the case may result in California’s Northern District federal courtroom looking for depositions from Saudi royals. Any selections on whether or not different Saudi authorities business offers within the United States have equally misplaced their immunity from U.S. courts must be made on a case-by-case foundation, he mentioned.
Sarah Leah Whitson, who runs the Democracy for the Arab World Now rights group based by Khashoggi, mentioned that “if they want to have sovereign immunity from their business transactions, it means they can sue people, they can demand that the judicial system enforces contracts and the laws governing contracts, but nobody can impose that against them. Nobody can hold them accountable.”
The Saudi-funded skilled golf tour, now in its second season and with a slogan of “Golf, but louder,” is understood for its blaring music, document multimillion-dollar purses, ties with Trump and unfriendly rivalry with the PGA Tour. Trump programs this yr will host three LIV tournaments, in offers whose monetary phrases haven’t been publicly disclosed.
Saudi Arabia’s immunity drawback is available in an antitrust lawsuit that was initially introduced by LIV gamers in opposition to the long-established PGA Tour. The case already has revealed that the Saudi authorities’s sovereign wealth fund owns 93% of LIV.
A lawyer for Saudi Arabia’s facet of the case didn’t reply to an electronic mail from The Associated Press looking for remark. A LIV spokeswoman referred inquiries to the Saudi sovereign wealth fund, which additionally didn’t reply to requests for remark.
Under the now eight-year rule of Saudi Arabia’s king, Salman, his son Prince Mohammed has made the dominion’s sovereign wealth fund a major device of Saudi funding at dwelling and overseas. The prince is the fund’s chairman. Saudi officers say the purpose is to diversify the dominion’s oil-funded financial system.
Under Prince Mohammed and fund governor al Rumayyan, the fund has greater than US$30 billion invested in Uber, Meta, luxurious electrical automobile model and Tesla rival Lucid, Paypal, Costco and different publicly traded U.S. companies.
The fund additionally has consolidated Saudis’ relationship with the Trump household, utilizing Trump golf programs and directing US$2 billion to the funding agency of Trump son-in-law Jared Kushner.
Rumayyan sits on the board of Uber. He performs golf with Trump. He triggered one among Elon Musk’s largest tweet storms and authorized circumstances, when Musk tweeted about what he later testified was the prospect of a Saudi sovereign wealth fund deal to take Tesla non-public.
The Saudi sovereign wealth fund is also spending closely on sports activities. In addition to creating the LIV golf tour, the Saudis have purchased the Newcastle United soccer workforce in Britain’s Premier League and hosted Formula One races, horse races with document prize cash, and different tournaments and matches, from snooker to boxing and chess.
Saudi Arabia is presenting itself as an brisk, youthful and business-friendly authorities. Human rights teams counter with the phrase “sportswashing,” saying the dominion below Prince Mohammed’s affect is making an attempt to distance itself from the killing of Khashoggi, the jailing of different rights advocates, and a failed conflict in Yemen. U.S. critics paint Saudi Arabia’s monetary offers with Trump and Kushner because the oil kingdom backing one facet in America’s extremely partisan politics.
“They’re really trying to rebrand the kingdom … using sport to reach a much wider public audience and trying to tap into some of the passion that people have,” mentioned Kristian Ulrichsen, a fellow for the Middle East on the Baker Institute in Houston.
To shut the deal shopping for Newcastle United, Saudi Arabia’s sovereign wealth fund supplied what authorities mentioned have been “legally binding assurances” that the dominion wouldn’t be concerned in working the workforce, although Rumayyan serves as workforce chairman. Rights advocates argued unsuccessfully for a reexamination of that deal in mild of the rulings of the California federal courtroom.
Critics — and the PGA Tour legal professionals in Friday’s submitting — additionally contend Saudi Arabia willingly waived sovereign immunity when it submitted authorities paperwork in one other U.S. case, in opposition to a Saudi who had served as a high intelligence official below the earlier king. The United States intervened to quash the case on the grounds it threatened to disclose nationwide safety secrets and techniques.
In the golf lawsuit, LIV gamers and the Saudi sovereign wealth fund, formally known as the Public Investment Fund, argue that unfair practices by the PGA are harming LIV. PGA legal professionals reply in filings that it is the reputations of Saudi Arabia and Prince Mohammed which can be scaring away business.
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AP Golf Writer Doug Ferguson contributed to this report.
