Sergio Garcia's attorney filed a six-page motion seeking to formally terminate the 46-year-old golfer's contract with LIV Golf, arguing the current limbo over his status is scaring off tournament organizers and sponsors who don't want to risk legal trouble by dealing with him. The filing lands as LIV Golf works through Chapter 11 bankruptcy proceedings in New Jersey, where the league is racing to lock down a restructuring plan before a key mid-October deadline.
According to the Sacramento Bee, Garcia's camp says contract termination should not be objectionable to LIV Golf, since it is consistent with the league's own statement that the agreement is not part of its go-forward business plan. Garcia's attorney also argued in the filing that, without a clean break, the golfer may be unable to represent that he is free of competing contractual commitments, which could discourage tournament organizers, sponsors and other counterparties from dealing with him at all. The legal nuance at the heart of the request is significant: under U.S. bankruptcy law, a debtor's rejection of a contract is treated as a breach rather than a formal termination, according to Yardbarker. That distinction has left Garcia unable to prove free-agent status to potential sponsors or tour organizers, since a mere rejection does not resolve lingering questions about exclusivity clauses.
LIV's Bankruptcy and the Scramble for LIV 2.0
LIV Golf New Jersey LLC voluntarily filed for Chapter 11 protection on September 8 in the U.S. Bankruptcy Court for the District of New Jersey, before Judge Michael B. Kaplan, reporting between $500 million and $1 billion in liabilities against $100 million to $500 million in assets. Hoodline previously reported on LIV's bankruptcy filing and the millions owed to its top players. The filing came after Saudi Arabia's Public Investment Fund, which had poured roughly $5 billion into LIV Golf since its 2021 launch, announced on April 30 that it would stop equity funding beyond the 2026 season. LIV received $49.6 million in debtor-in-possession financing.
The cash crunch had already forced brutal cuts inside the league before the bankruptcy filing. LIV terminated roughly 289 employees and furloughed 22 more in early September, leaving just 41 staffers to run corporate operations, per the Department of Justice. Professional golfers now make up roughly half of LIV's 30 largest unsecured creditors, including Jon Rahm, Bryson DeChambeau, Dustin Johnson, Cameron Smith, Tyrrell Hatton and Brooks Koepka. Claims for the six total $28.62 million.
A Player-Owned League Hangs on a Deadline
LIV is now working toward fulfilling a restructuring agreement tied to its Chapter 11 case so it can continue operating in 2027 and beyond under what it calls the LIV 2.0 business plan, per the Sacramento Bee. Investment firm BC Partners Credit has agreed to anchor a $300 million investment into that reorganized league, which is designed around a player-majority ownership model, according to LIV Golf's own announcement. The restructuring agreement includes conditions that must be met within 35 days of the bankruptcy filing, and LIV players with financial claims must agree to participate in LIV 2.0 representing at least two-thirds of the total dollar amount of those claims. Golf Channel has reported that LIV secured more than enough verbal commitments to clear that threshold, and the league faces a deadline of October 13.
Garcia himself is not among the players pushing to stick around for LIV 2.0. The 2017 Masters champion, who has 11 PGA Tour titles and 16 DP World Tour wins to his name, plans to play on the DP World Tour, formerly known as the European Tour, in 2027. Garcia previously paid more than $1 million in fines to regain his DP World Tour membership after resigning it in 2023, and he remains the all-time leading points scorer in Ryder Cup history with 28.5 points across 10 European team appearances, according to Sports Illustrated. Any attempt to return to the PGA Tour, however, would face a mandatory 365-day suspension counted from a player's final unauthorized start, a rule Hoodline detailed when covering Henrik Stenson's return from LIV exile.
A Masters Meltdown and an Australian Club's Costs
Garcia's push for a clean break also comes against the backdrop of reporting that tied his conduct to LIV's funding collapse in the first place. An August Financial Times report, cited by Fox Sports, alleged that PIF Governor Yasir Al-Rumayyan was deeply embarrassed by Garcia's outburst at the 2026 Masters in April, when Garcia smashed his driver against a water cooler and tore up tee box turf, reportedly serving as a tipping point in the Saudi fund's decision to pull its backing.
Garcia is not the only party seeking clarity from the bankruptcy court. Kooyonga Golf Club, an Australian course, has requested an expedited ruling on whether it can reject its contract to host a LIV Golf event, after spending $134,000 preparing for the tournament, and the club wants that money reimbursed, per the Sacramento Bee. LIV's next hearing in the case is scheduled for October 7 at the U.S. Bankruptcy Court for the District of New Jersey, where more of the league's unresolved obligations are likely to come into focus.
