PGA Sued for $20 Million in Cuban Snafu

WEST PALM BEACH (CN) - A Canadian real estate company sued the PGA for $20 million, claiming it had to abandon plans to license the PGA trademark to a Cuban golf course when the PGA truckled to "Capital Hill Cubans."

360 Vox Corp. fka Leisure Canada sued the Professional Golfers' Association of America for tortious interference, in Palm Beach County Court.

Vox claims it paid $130,000 in fees and $5.5 million in expenses to license a golf course in Jibacoa, about 20 miles from Havana. It claims it lost $20 million in anticipated profits when the PGA caved in to protests from "Capital Hill Cubans."

Vox claims that in 2011 it entered into the Cuban golf deal agreement with PGA's English sister company, the Professional Golfers' Association Limited (PGAL), which owns the PGA trademark in Cuba.

"The purpose of the agreement was for Leisure Canada to license the PGA brand for use at certain golf facilities and real estate developments in Cuba. In exchange for the exclusivity rights, Leisure Canada paid PGAL an $80,000 initial non-refundable fee in accordance with the terms of the agreement," the complaint states.

The United States has a trade embargo on Cuba, but Canada doesn't, nor does England. Vox is based in Montreal.

"At all material times germane to the interference as alleged in this lawsuit, the PGA of America had no interest whatsoever in golf in Cuba and held no rights regarding or licensing within Cuba," Vox says in the lawsuit.

Nonetheless, after Leisure Canada announced its plan to license the PGA mark to the Cuban golf course, "certain U.S. media outlets picked up on the story and questioned whether PGAL was violating U.S. sanction laws being spent in Cuba - even though Leisure Canada and PGAL are not American companies," according to the complaint.

"In particular, on March 17, 2011, a group by the name of Capital Hill Cubans issued a statement criticizing Leisure and PGAL for the agreement, as well as Leisure Canada's press release, and suggested that PGAL was using its British brand to 'skirt sanctions' for violating U.S. law".

The PGA of America held a "Q and A" the next day to disavow any connection with the project, Vox claims.

It claims the PGA wrote to warn it that a Cuban golf course using the PGA trademark would "risk" a claim of infringement.

"Sometime in August 2011, PGAL officials met with the PGA of America officials to discuss the agreement in an attempt to resolve the objections of the PGA of America," the complaint states.

"... Based on the events that followed, it is clear that the PGA of America, as the largest and most influential member of the PGA, made sure that PGAL did not proceed forward with the substantial plans as outlined in the background sections of both the agreement and LOI [Letter of Intent]."

Finally, Vox claims: "Succumbing to pressure from the PGA of America regarding its objection to the agreement, on December 18, 2012, PGAL sent 360 Vox a letter stating that it was terminating the agreement and would no longer agree to work with 360 Vox in Cuba."

Vox demands the $130,000 it paid under the contract, $5.5 million in expenses and $20 million in lost profits.

It is represented by Glen Waldman with Heller Waldman in Coconut Grove.

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