KANSAS CITY, Kan. – Denny Hamlin expressed confidence on Saturday in the case presented by his team 23XI Racing, co-owned by veteran driver and NBA legend Michael Jordan, and Front Row Motorsports against NASCAR, alleging antitrust violations.
Hamlin made these statements a day after a panel of three federal appeals court judges indicated that it could overturn a court order allowing 23XI and Front Row to compete as teams with participation rights, while his lawsuit against the stock car racing series unfolds in the courts.
“They’re telling me what’s going on. I didn’t get to hear it live or anything like that,” Hamlin said after qualifying 14th for Sunday’s race at Kansas Speedway. “But overall, we’re pretty confident in our case.”
Denny Hamlin
The teams filed the antitrust lawsuit against NASCAR on October 2 in the Western District of North Carolina, arguing that the series pressured the teams to sign participation rights agreements, which are essentially franchise agreements, that hinder financial competition.
These were the only two teams out of the 15 that hold participation rights that refused to sign the agreements in September.
The most recent extension of the charter rights lasts until 2031, coinciding with the current media rights agreement. Perhaps the biggest benefit of these is that they guarantee 36 of the 40 available spots in each NASCAR race to the teams that own them.
If the court order is revoked, 23XI and Front Row would run as “open teams,” meaning they would have to qualify at each Cup event. But there are only four open spots, and 23XI had four cars at Kansas this week and Front Row had one.
“The judges haven’t issued any ruling,” Hamlin said, “so until they do, we’ll stick with the status quo.”
Denny Hamlin
NASCAR attorney Chris Yates argued that the injunction, granted in December by U.S. District Judge Kenneth Bell, forced the series into an unwanted relationship with unwilling partners, and that it harms other teams because they earn less money. He also said that the teams should not have the benefits of the participation rights system that they are suing to revoke.
“There is nowhere else to compete,” responded Jeffrey Kessler, the lawyer representing 23XI and Front Row, noting that revoking the injunction would cause tremendous damage to the teams, which could include the loss of drivers and sponsors.
Jeffrey Kessler
“It will wreak havoc to overturn this court order in the middle of the season,” Kessler said.
Jeffrey Kessler
There is a trial date set for December, and Judge Steven Agee urged the parties to meet for mediation, previously ordered by a lower court, to try to resolve the dispute over the injunction. But that seems unlikely.
“We are not going to rewrite the right to participate,” Yates told the judges.
Chris Yates
