Judge urges NASCAR and teams, including Jordan, to resolve legal battle

CHARLOTTE, N.C. – A federal judge urged NASCAR and two of its teams, including one owned by NBA legend [Michael Jordan], to resolve their growing and acrimonious legal battle that intensified in tense arguments during a hearing on Tuesday. U.S. District Judge Kenneth Bell of the Western District of North Carolina questioned both NASCAR and the teams: 23XI Racing, owned by Jordan and three-time Daytona 500 winner, [Denny Hamlin], and Front Row Motorsports, owned by businessman Bob Jenkins, about what they hoped to achieve in the antitrust battle that has affected the stock car series for months. It’s hard to imagine a winner if this goes all the way in this case. It terrifies me to think about what all this is costing. 23XI and Front Row were the only two organizations that refused to sign an offer from NASCAR last September regarding a new charter agreement. Charters are NASCAR’s version of a franchise model, with each charter guaranteeing entry into the lucrative Cup Series races and a stable revenue stream; 13 other teams signed the agreements last fall, and some claimed they had little choice. The nearly two-hour hearing focused on the teams’ request to dismiss NASCAR’s counterclaim, which accuses Jordan’s business manager, Curtis Polk, of “deliberately” violating antitrust laws by orchestrating anti-competitive collective conduct in negotiations. NASCAR said it discovered that Polk, in messages among the 15 teams, attempted to form a “cartel”-like operation that would include threats to boycott races and refuse to negotiate individually. One of NASCAR’s lawyers even cited a quote from Benjamin Franklin that Polk supposedly sent to the 15 organizations, saying: “We must all hang together, or most assuredly we shall all hang separately.” Jeffrey Kessler, a lawyer representing the teams, was angered by the revelation in open court, arguing that it is privileged information only revealed in discovery. Kessler also argued that none of NASCAR’s claims in the counterclaim demonstrate that Polk or the Race Team Alliance did anything illegal during the statute negotiation process.

NASCAR knows it has no defense against the monopolization case, so it has presented this claim about joint negotiations, which they agreed to, never objected to, and now suddenly it’s an antitrust violation. It makes no sense. It’s not going to help them deflect the monopolization they’ve done in this market and the damage they’ve inflicted.

Jeffrey Kessler, lawyer for the teams

He added that “the attacks” against Polk were “false, unfounded and, frankly, beneath the dignity of my opponent even to make those kinds of comments, about which he should know more”. NASCAR’s lawyers said Polk improperly tried to pressure the 15 teams that make up the RTA to collectively join negotiations and encouraged a boycott of qualifying races for the 2024 Daytona 500. NASCAR, they said, took the threat seriously because the teams had previously boycotted a scheduled meeting with series executives.

NASCAR knew the next step was that they could boycott a race, which was a threat they had to take seriously.

Lawrence Buterman, NASCAR attorney

Kessler said outside the court that the two teams are open to settlement talks, but noted that NASCAR has said it will not renegotiate the statutes. NASCAR’s lawyers declined to comment after the hearing. Bell did not indicate when he would rule, other than to say he would decide quickly. Kessler said he would file an appeal at the end of the week after a three-judge federal appeals panel dismissed a preliminary injunction that required NASCAR to recognize 23XI and Front Row as authorized teams while the legal battle is resolved. Kessler wants the matter to be heard by the full appeals court. The court order has no bearing on the merits of the case, which is scheduled to go to trial in December. The earliest NASCAR can treat the teams as unauthorized is one week after the deadline to appeal, provided there is no pending appeal or when the appeal process has been exhausted. There are 36 cars authorized for the field of 40 cars each week. If 23XI and Front Row are not recognized as authorized, their six cars would have to compete as “open” teams, which means they would have to qualify by speed each week to participate in the race and would receive a fraction of the money guaranteed for authorized teams. Some of Tuesday’s arguments focused on Jonathan Marshall, the RTA’s CEO. NASCAR has demanded text messages and emails from Marshall and says it has received approximately 100 texts and more than 55,000 pages of emails. NASCAR wants all texts between Marshall and 55 people from 2020 to 2024 that contain specific search terms. RTA lawyers said that covers more than 3,000 texts, some of which are privileged and some of which have been “deleted to save storage or no longer needed”. That topic is scheduled to be heard during a hearing next Tuesday before Bell.