Jack Nicklaus’ $50m court victory pushes Nicklaus Companies into bankruptcy

Nicklaus Companies has filed for Chapter 11 bankruptcy protection, just weeks after a Florida jury awarded Jack Nicklaus $50 million in his defamation case against the firm that bears his name.

The company confirmed the filing in a statement on Friday, saying the move was necessary “to protect its employees, clients, and ongoing business operations.” 

The Chapter 11 process was initiated in the US Bankruptcy Court for the District of Delaware.

According to Bloomberg, the filing lists the company’s estimated assets between $10 million and $50 million, against liabilities ranging from $500 million to $1 billion.

Chief executive Phil Cotton said the decision was made to safeguard the business during a turbulent period. 

“We take this step to protect our brand, our client relationships and—most importantly—our employees,” said Cotton. 

“We remain committed to delivering the highest standard of service to our clients worldwide.”

The company noted that Chapter 11 protection will allow it to address long-term debt obligations as well as the recent jury verdict in favour of its founder.

The ruling on 20 October saw Nicklaus, 85, awarded $50 million in damages. 

The lawsuit centred on claims that senior figures within the company—owned by New York financier Howard Millstein—spread false allegations that Nicklaus had considered a $750 million offer to join LIV Golf, and that he was suffering from dementia and no longer capable of managing his affairs.

Jurors did not hold Millstein or fellow executive Andrew O’Brien personally liable.

Nicklaus Companies maintains it disputes the verdict and is considering appeal options.

This latest development follows a legal setback earlier in the year, when a New York judge dismissed the company’s attempt to restrict Nicklaus from using his own name, image and likeness in his golf course design ventures.

Nicklaus and Millstein first joined forces in 2007 through a $145 million deal that created Nicklaus Companies, giving Millstein a minority stake across Nicklaus’ design, marketing, and equipment businesses.