Two-time major champion Jon Rahm is leaving the LIV Golf League, dealing a blow to the breakaway golf circuit that is trying to emerge from federal bankruptcy without funding from Saudi Arabia's Public Investment Fund.
During a hearing with U.S. Bankruptcy Court of New Jersey Judge Michael B. Kaplan on Wednesday, Rahm's attorney, John Beck, said that Rahm is leaving LIV Golf.
"Mr. Rahm has independently reviewed the proposed terms of LIV 2.0 and has determined that those terms are unacceptable to him, and he will not be participating going forward in LIV 2.0," Beck said.
Beck said Rahm and LIV Golf were working to finalize a separation agreement by Oct. 15.
It isn't clear where Rahm might play in 2027. On Sept. 15, PGA Tour CEO Brian Rolapp affirmed that the tour currently had no plans to bring back the Returning Member Program, which would allow Rahm, Bryson DeChambeau and Cameron Smith to come back under certain conditions.
Brooks Koepka used the program to come back to the PGA Tour in January.
Rahm is a member of the DP World Tour after resolving his dispute with the European tour in May.
Rahm, 31, was considered a linchpin in LIV Golf's dwindling hopes to keep the circuit alive. Along with two-time U.S. Open champion DeChambeau, Rahm is the most accomplished and popular golfer who left the PGA Tour for LIV Golf.
Rahm signed with LIV Golf in December 2023, and the league's poaching of the then-reigning Masters champion was considered a major coup. He reportedly received a multiyear contract worth more than $300 million.
Rahm was a four-time winner in the LIV Golf League and was the circuit's season-long individual champion in each of the past three seasons.
LIV Golf and its related entities voluntarily filed for Chapter 11 protection on Sept. 8. The league indicated it had between $100 million and $500 million in assets and $500 million to $1 billion in liabilities, according to court records.
Rahm ($7.5 million), DeChambeau ($5.7 million), Dustin Johnson ($5.5 million), Smith ($4.8 million), Tyrrell Hatton ($3.4 million) and Koepka ($1.7 million) were listed among the league's creditors with the 30 largest unsecured claims, per the court records.
Those totals reflected the past-due payments owed to the golfers but not what was owed to them beyond the bankruptcy filing date. It is believed that Rahm is owed more than $100 million.
In May, Rahm acknowledged that he had multiple years on his LIV Golf contract and didn't see "many ways out."
"Right now, I have several years in my contract left," Rahm said in May. "I'm pretty sure they did a pretty good job when they drafted that, so I don't see many ways out. Right now, I'm not really thinking about it because we still have a season to play and majors to compete for. It's not something I want to think about just yet."
LIV Golf's bankruptcy apparently changed Rahm's circumstances.
LIV Golf CEO Scott O'Neil has said that the second iteration of the league would include 10 tournaments with smaller purses.
On Monday, LIV Golf filed a restructuring support agreement with the bankruptcy court and indicated that it would receive a $300 million investment from BC Partners, as long as certain conditions were met. BC Partners' initial investment was $4 million.
One of those conditions of the agreement is the "execution of New Player Agreements consistent with the LIV 2.0 business plan that include players required by BC Partners."
The agreement extended the deadline to Oct. 25 for current LIV golfers to commit to the league.
Former Masters champion Sergio Garcia, a LIV Golf captain, has been released from his contract, according to court records.