[Photo: Icon Sportswire]

In the wake of the $US50 million judgment awarded last month to Jack Nicklaus in his defamation lawsuit against his former company, Nicklaus Companies filed for Chapter 11 bankruptcy on Friday.

The company announced the move in a news release on its website, stating that “to protect its employees, clients, and ongoing business operations, Nicklaus Companies LLC and certain of its subsidiaries… have commenced voluntary chapter 11 cases in the United States Bankruptcy Court for the District of Delaware”.

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Bloomberg News reported on Saturday (US time) that according to the filing, Nicklaus Companies listed estimated assets of $US10 million to $US50 million and liabilities of between $US500 million and $US1 billion.

“We take this step to protect our brand, our client relationships, and – most importantly – our employees,” Phil Cotton, Nicklaus Companies’ chief executive officer, said in release “We are dedicated to protecting the brand and continuing to offer the highest standard of service to our clients all over the world.”

According to the company release, the filing will allow Nicklaus Companies “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”.

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In an October 20 judgement, a Florida jury awarded damages of $US50 million to Nicklaus, 85, against the company that bears his name, which is owned by New York banker Howard Millstein. Jurors did not find Millstein or Nicklaus Companies executive Andrew O’Brien, who also were named individually as defendants, personally liable.

According to the lawsuit, Nicklaus claimed that Milstein, O’Brien and others at the company spread false stories that Nicklaus had considered a $US750 million offer to join the Saudi Arabia-backed LIV Golf League and that he was suffering from dementia and was no longer mentally fit to manage his affairs.

Nicklaus Companies disputes the verdict, the release stated, and intends to explore options for a potential appeal.

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Earlier this year, a New York judge dismissed a lawsuit filed by Nicklaus Companies against Nicklaus that sought to prevent the 18-time major winner from using his name, image and likeness to promote his golf course design business after he left the company.

Nicklaus and Millstein agreed to a $US145 million deal in 2007 that launched Nicklaus Companies. Millstein acquired a minority stake in the newly formed company that included interests in Nicklaus’ course design, marketing and golf-equipment businesses.