Federal Judge Dismisses NASCAR Counterclaim in Legal Dispute
A federal judge ruled in favor of 23XI Racing and Front Row Motorsports, dismissing the counterclaim filed by NASCAR in a legal dispute over allegations of anti-competitive practices. Judge Kenneth Bell issued a summary judgment in favor of the teams, rejecting NASCAR’s claim that Curtis Polk, co-owner of 23XI, illegally colluded with other teams during negotiations for new bylaws. 23XI, also owned by Michael Jordan and Denny Hamlin, had been accused of participating in an alleged collusion. Polk, who is also Jordan’s commercial manager, was part of a negotiating team that worked with NASCAR for more than two years on the charter agreement signed by several organizations last year. NASCAR argued in its counterclaim that a 2023 boycott of the team owners council meeting negatively impacted media rights negotiations. Additionally, the racing series alleged that the unification of the organizations in the charter talks resulted in a more favorable agreement for the teams.Judge Bell determined that 23XI and FRM did not engage in an “unreasonable restraint of trade.” NASCAR’s individual meetings with the teams led to changes in the charter agreement. Furthermore, since all charter agreements would be the same for all teams, the joint work in the negotiations was considered reasonable. Bell also pointed out that NASCAR conducted individual negotiations during the negotiation period, achieving concrete results, including the final 2025 charter agreement, signed by several teams acting individually. The judge must also decide on two other summary judgment motions: one from NASCAR seeking a ruling in its favor and another from 23XI and FRM to designate the market as “premier stock-car racing.” The two days of mediation last week failed to resolve the dispute, 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 charter extensions, which are fundamental to NASCAR’s business model. A car with a charter guarantees income and access to weekly races, and without them, both teams claim they would surely go bankrupt.The boycott was a negotiation tactic “that seemed to have little impact” as NASCAR initiated individual negotiations shortly thereafter.
Judge Kenneth Bell
NASCAR indicated that it is still hoping to reach an agreement. The season concludes with Sunday’s championship final in Phoenix, and Hamlin is one of the four drivers eligible for the Cup title. NASCAR stated that it respects the court’s decision, although it does not agree with its legal reasoning. The series’ priority remains to resolve 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, NASCAR intends to appeal the decision in due course.Today’s decision has only reaffirmed my clients’ unwavering pursuit of a fairer and more equitable sport. Their determination remains strong as we continue our efforts to achieve a resolution that benefits everyone: teams, drivers, employees, partners, and fans.
Jeffrey Kessler, attorney for 23XI/FRM
