WASHINGTON: Public relations agency Gitcho Goodwin, now a former client of Saudi-backed LIV Golf, recently filed a foreign agent application with the Justice Department, raising questions about the need for register for companies working on behalf of foreign managers.
Gitcho Goodwin’s filing contradicts LIV’s position that the tour does not need to be registered via the Foreign Agents Registration Act because the golf tour is a foreign business enterprise and it is not an organization that defends the political interests of Saudi Arabia.
Boston-based Gitcho Goodwin filed an application under the Foreign Agents Registration Act on May 25 after learning that the Saudi Public Investment Fund, who finances the LIV, “occasionally oversaw (LIV’s) public relations activities,” the company said in one of its filings. A representative for Gitcho Goodwin could not be reached for comment.
Since February, Gitcho Goodwin and another communications firm, GP3 Partners, have provided public relations support to LIV, including writing press releases, organizing media training for players and offering advice on marketing. golf company’s corporate social responsibility strategy, according to the former’s registration file. GP3 paid Gitcho Goodwin a monthly retainer of $55,000. A GP3 representative could not be reached for comment.
Gitcho Goodwin’s filing has sparked new concerns from agencies working for foreign entities, making it difficult to determine whether to register as a foreign agent, said Marc Ross, chief communications strategist from the geopolitical communications company Caracal.
“Do sports teams or leagues that have foreign investors have to register? asks Ross, referring to foreign-owned teams such as the NBA’s Brooklyn Nets or English soccer team Manchester City. “As a communicator or a large PR firm, do I take these clients? There is no guidance. It’s a bit like the Wild West. »
Gitcho Goodwin’s registration statement also cited a statement filed by LIV in a lawsuit initiated by its former competitor, the PGA Tour. In the filing, a Saudi lawyer acting on behalf of the PIF said the fund is “inextricably linked to the (Saudi) government, such that (the PIF’s) objectives may be indistinguishable from the interests of the Saudi government.”
Four days after its registration, Gitcho Goodwin filed another statement declaring that its partnership with GP3 Partners and LIV had ended. A representative for LIV could not be reached to confirm whether Gitcho Goodwin was fired for registering or commenting on the topic.
This is not the first time that a communications agency has clarified its links with LIV. United Entertainment Group, a subsidiary of Edelman, has partnered with marketing company Performance54 to launch LIV in 2021. The agreement between UEG and Performance54s, concluded in March 2022, was never registered with the DOJ.
In August, an Edelman spokesperson told PRWeek: “Edelman does not have a relationship with LIV Golf. UEG, a subsidiary of DJE Holdings, undertook a project a year ago – completed earlier this year – for US company Performance54, which did not require a filing (DOJ).
Suppliers need to recognize the growing role of geopolitics in sport and devote resources to monitoring relevant factors, says Ross.
“Sport is now becoming another battleground for geopolitics, communications and human rights. It’s no longer just about putting the ball in the back of the net, there are new players involved,” he adds.
Organizations including 9/11 Families United took aim at LIV on Tuesday. Terry Strada, National President of the Families of 9/11, Sent a Letter to the DOJ calling for investigation into Saudi foreign agents for alleged FARA violations.
Strada’s request preceded PGA Tour and shocking LIV merger announcement, crush ongoing disputes between rivals and establish a single golf powerhouse.
Strada blasted the deal in a separate statement, calling the PGA and its commissioner, Jay Monahan, “paid Saudi shills.”
FARA’s primary concern for agencies is whether they are providing advice “on behalf of or in the interest” of a foreign entity. If so, they would meet the definition of an “agent of a foreign principal” under U.S. Code 22, says Louis DiLorenzo, a partner at the law firm Davis+Gilbert, by email. in FARA. In this case, registration is required.
Alternatively, if the company only supported “private, apolitical activities designed to promote good faith commerce” or engaged “in other activities not primarily serving a foreign interest,” it would fall foul of the exception to FARA and the company would not need to do so. save.
Michael Lasky, founder and president of the public relations law firm of Davis+Gilbert, says salespeople would do well to understand the aforementioned rules. But because FARA’s language is broad, it’s imperative for agencies to set clear expectations from the start of their relationship with clients.
“I think it’s a legitimate question for PR agencies to ask: ‘Who are the decision makers at (companies such as) LIV Golf?’ What are the sources of its financing?’ said Lasky.
If a potential client says it operates entirely separately from its foreign owners and investors, it is up to agencies to “memorize” that representation in client contracts, Lasky adds. If a company finds that this is not the case, it must clarify and fulfill its legal obligations.
“The PR firm has to be upfront with the client and say, ‘This is the legal system as it exists in the United States, and we are required to register.’ There are very significant penalties if we don’t register, and it’s both our responsibility to do so and tell you,” he says.
LIV’s deal with the PGA Tour raises more questions for marketers. Does the PGA Tour have to comply with FARA, for example? DiLorenzo says that after the merger, it’s difficult to say whether registrations will be required to work with the combined entity.
“The merger could make it more likely that work for LIV falls within the commercial exemption, particularly if a PR agency promotes LIV’s commercial interests, for example by attempting to increase audiences or find sponsorship deals,” DiLorenzo said.
The situation becomes even more complicated if the Saudi government or the PIF “remains actively involved in promoting the LIV or if the companies are called upon to engage in activities intended to influence American public opinion regarding the broader interests of the LIV.” “Saudi Arabia,” adds DiLorenzo.
