Federal Judge Dismisses NASCAR’s Counterclaim Against Suing Teams
In a recent court decision, federal judge Kenneth Bell issued a ruling in favor of 23XI Racing and Front Row Motorsports, dismissing the counterclaim filed by NASCAR. The racing series had accused Curtis Polk, co-owner of 23XI, of illegal collusion with other teams during negotiations for new statutes. 23XI Racing, also owned by NBA legend Michael Jordan and three-time Daytona 500 winner Denny Hamlin, is at the center of this legal dispute. Polk, who has been Jordan’s business manager for a long time, was part of a negotiating team that worked with NASCAR for more than two years on the charter agreement signed by 13 of the 15 organizations last year. NASCAR argued in its counterclaim that the 2023 boycott of the meeting of the team owners council negatively affected media rights negotiations. In addition, the racing series alleged that the unification of the 15 organizations in the talks about the statutes resulted in an agreement more favorable to the teams than they would have obtained if NASCAR had negotiated separately. Judge Bell determined that the boycott was a negotiation tactic “that appeared to have little impact,” as NASCAR initiated individual negotiations shortly thereafter. He also found that 23XI and FRM did not engage in an “unreasonable restraint of trade,” given that NASCAR’s individual meetings with the teams resulted in changes to the charter agreement. Judge Bell highlighted that individual negotiations achieved concrete results, including the final 2025 statutes agreement, signed by 13 teams acting individually. Judge Bell must also rule on two other summary judgment motions: one filed by NASCAR in its favor and another by 23XI and FRM to designate the market as “premier stock-car racing.” Despite two days of mediation last week, this dispute was not resolved, and the trial is still scheduled for December 1 in North Carolina. 23XI and FRM are the only two organizations out of 15 that refused to sign extensions to the charters, which are fundamental to NASCAR’s business model. A car with a charter is guaranteed income and access to weekly races, and without them, both teams claim they would almost certainly have to shut down.NASCAR indicated that it is still hoping to reach an agreement. The season concludes with Sunday’s championship in Phoenix, and Hamlin is one of the four drivers eligible for the Cup title.“Today’s decision has only reaffirmed my clients’ unwavering pursuit of a fairer and more equitable sport,” said Jeffrey Kessler, attorney for 23XI/FRM. “Their determination remains strong as we continue our efforts for a resolution that benefits everyone: teams, drivers, employees, partners, and fans.”
Jeffrey Kessler, attorney for 23XI/FRM
“We respect the Court’s decision, although we respectfully disagree with its legal reasoning,” NASCAR said. “Our priority remains resolving this matter quickly so that all parties can focus on the championship weekend and continue to grow the sport. If a resolution is not reached, we intend to appeal the decision in due course.”
NASCAR
