The future looks seriously bleak for vendors and contractors who are owed money by LIV Golf, with the league now moving to wind down operations. Bankruptcy attorney John J. Sparacino from McKool Smith didn’t pull any punches, telling Front Office Sports that “the outlook for unsecured creditors is likely quite bleak.”
A $98 Million Problem and a Stack of IOUs
Here’s the gut-punch: LIV’s unsecured creditors are staring down more than $100 million in claims. But how much is actually available for them to recover? A measly $2 million. That’s it, for now anyway. LIV’s chief restructuring officer David Orlofsky mentioned this number during an October 15 creditors meeting, adding that while it “may change over time,” that’s “kind of what’s on the table at the moment.” You gotta wonder if anyone in that room felt “comfortable” with that number, because sources familiar with the creditors committee’s thinking sure don’t. They’re hoping that $2 million somehow balloons into a lot more, but it’s looking like an uphill battle. Potential cash could come from more claims against the Saudi PIF, third parties, or even LIV employees.
And who are these unsecured creditors getting the short end of the stick? Fourteen of the 30 largest are LIV players themselves, but it’s not just them. Agencies like IMG Media are owed $3.2 million, GSE Worldwide is waiting on $1.28 million, golf influencer Rick Shiels is in for $1.39 million, the state of Louisiana has $1.22 million on the books, and production company Fresh Tape Media is due $1.2 million. The creditors committee, repped by Willkie Farr & Gallagher and Fox Rothschild, has one goal: maximize value for everyone. Good luck, seriously.
PIF Holds the Cards, Exec Bonuses a Wild Card
The Saudi PIF, LIV’s former financial backer, is the big dog here. They’re the largest creditor, thanks to nearly $500 million in secured funding they dropped to finish the 2026 season. That gives the PIF control of LIV’s bankruptcy, and they even coughed up $49.6 million in debtor-in-possession (DIP) financing to keep the bankruptcy process moving. Could they just pony up more cash to the unsecured creditors? Theoretically, yeah. But most experts are saying that’s not happening.
Joe Bain, co-chair of Jones Walker’s bankruptcy and restructuring team, put it bluntly: “With where this case is going, it’s hard to imagine that there will be any material recoveries to really anyone.” Sparacino echoed that, suspecting “trade vendors will get little or no recovery” and there’s “likely to be virtually nothing to distribute to unsecured creditors.”
So, what’s a creditor to do? Here’s where it gets spicy. One “outside-the-box” idea could be trying to claw back some of the $15.6 million in retention bonuses paid to seven LIV executives in June and August. Brooklyn Law School professor Jodi Balsam, who used to be counsel for the NFL, floated this idea because those payments happened within 90 days of LIV filing for bankruptcy. Could be a long shot, but when you’re looking at $2 million for $100 million in claims, you gotta explore everything, right?
LIV is set to file its new Chapter 11 wind-down plan on Monday, which might spill more details about paying out unsecured claims. The creditors committee is meeting again on November 20. It feels like this drama isn’t ending any time soon, but the picture for those owed money just keeps getting bleaker.
This article was created with AI assistance and published under Seattle On Tap’s editorial standards. See our Editorial Policy.
Originally reported by Yahoo Sports.
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