The lawsuit, filed just over a year ago in U.S. federal court in California, said the PGA Tour threatened to prevent the caddies from working at tournaments organised and promoted by the organisation if they refused to wear the bibs.
The lawsuit also claimed that the PGA Tour reaps more than $50 million annually from the endorsements, but the caddies receive no compensation.
However United States District Judge Vince Chhabria on Tuesday dismissed the lawsuit with prejudice, saying: "The caddies' overall complaint about poor treatment by the Tour has merit, but this federal lawsuit about bibs does not."
The caddies, who were seeking a permanent injunction against the practice of wearing bibs, help their players select clubs and read the greens during tournaments.
Mike Hicks, the lead plaintiff, has been a caddie for nearly 35 years and has worked for leading golfers such as Greg Norman, Payne Stewart, Steve Stricker and Justin Leonard.
The lawsuit, filed on behalf of 168 caddies in the U.S. who wear or have worn bibs with the logos of the PGA Tour's sponsors, claimed the Tour interfered with the caddies' ability to compete in the market, alleged antitrust violations, breach of contract and violations of California state law.
Now that the judge has dismissed the lawsuit, each of the 168 caddies must decide individually whether to appeal.
The caddies had a previously-scheduled meeting planned at the PGA Tour stop in Pebble Beach, California on Wednesday. The lawsuit ruling immediately went to the top of the unofficial agenda.
"To be honest, I don't think I really want to continue," said one caddie, who asked not to be named. "The system has spoken."
He added that the lawsuit had been mentally draining and that he wanted to get back to focusing on his job.
James Edmondson, president of the Association of Professional Tour Caddies, sounded a similar theme.
"I respect the court's decision and do not plan to go any further with it," he told GolfChannel.com.
The PGA Tour said in a statement that they were "pleased by the court's decision" in their favour.
"We look forward to putting this matter behind us and moving forward in a positive direction with the caddies."
In his ruling, judge Chhabria said: "Caddies have been required to wear the bibs for decades. So caddies know, when they enter the profession, that wearing a bib during tournaments is part of the job. In other words, the bib is the primary part of a caddie's uniform."
(Reporting by Mark Lamport-Stokes in Los Angeles; Editing by Andrew Both)
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