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Can an invitational-classed club game restrict entry in this manner?

Just curious.  A friend of mine recently moved and at her new club they have a once-weekly game which they run as invitational because they don't invite the top 10 players at the club (a lot of people wanted a game without sharks).

Is this a legal way for them to do it?  Are there any limits on how an Invitational game may restrict those eligibie to attend?

Yes, it's legal.
No, it's not.

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