It has been an eventful, if not tumultuous, year for Jack Nicklaus and the company he founded.
In a year marked by litigation, the Nicklaus Companies has filed for Chapter 11 bankruptcy protection a month after a Florida jury awarded the golf legend a $50 million judgment in a defamation suit against the company.
"To protect its employees, clients, and ongoing business operations, Nicklaus Companies LLC (the 'Company') and certain of its subsidiaries today announced that they have commenced voluntary chapter 11 cases in the United States Bankruptcy Court for the District of Delaware," according to a news release on the Nicklaus Companies website.
Nicklaus filed suit against his former company, now controlled by New York banker Howard Milstein, earlier this year after it claimed he considered a $750 million offer to join the LIV Golf league, suffered from dementia and was unable to manage his affairs, according to published reports. Bloomberg News reported that, citing the Chapter 11 filing, Nicklaus Companies has estimated assets of $10 million to $50 million and liabilities of between $500 million and $1 billion.
Although the jury ruled against Nicklaus Companies, it cleared Milstein and company executive Andrew O'Brien.
"The filing will allow the Company to proactively address its long-term funded indebtedness and other liabilities, as well as a jury verdict returned in a Florida state court last month following a lawsuit filed by company founder and former Co-Chair Jack Nicklaus. The jury ruled in favor of two Nicklaus Companies' executives but awarded $50 million in damages against the Company," continued the Nicklaus Companies release.
Nicklaus sold exclusive rights to his golf course design services, including marketing, promotional and branding rights in 2007 for $145 million to Milstein, but stayed on as the face of the company. Nicklaus stepped away from the company he founded a decade later after repeated clashes between the golfer and Milstein, according to Golf Digest, supposedly triggering a five-year noncompete clause.
Shortly after Nicklaus stepped down from the board, his former company filed suit alleging he violated terms of the contract and should be restricted from using his name in his own design services. Golf Digest reported that Milstein wanted Nicklaus to continue to run his golf course design business through the company and use of his name for any other endeavor violated the noncompete clause.
A Florida arbiter ruled in July 2024 that the golfer was no longer bound by the noncompete agreement. Then in March, a New York judge dismissed the case entirely, ruling that Nicklaus could indeed use his name to promote his course design efforts. Nicklaus then filed a countersuit in response to the LIV Golf claims, the most recent round of litigation between Nicklaus and Nicklaus Companies.
The company says it plans to dispute the $50 million verdict that triggered the Chapter 11 filing and explore options to appeal.
The North Palm Beach, Florida-based company also says the recent decision will not affect employees.