NASCAR Seeks New Mediator in Antitrust Litigation: Crisis in Motorsports?

NASCAR Seeks to Mediate Legal Dispute with Michael Jordan’s Teams

In a recent move, NASCAR has requested a judicial settlement conference from a federal court to mediate the antitrust lawsuit filed by 23XI Racing, owned by Michael Jordan, and Front Row Motorsports. The request seeks the intervention of an independent judge to facilitate negotiations. The 23XI Racing and Front Row Motorsports teams have responded to the request, expressing their desire to continue working with mediator Jeffrey Mishkin, former executive vice president and general counsel of the NBA, who has been negotiating between the parties during this year.

“Mr. Mishkin has invested a great deal of time in learning about this case and meeting with the parties,” 23XI and Front Row stated in their presentation. “The plaintiffs have requested that NASCAR continue to negotiate with them through Mr. Mishkin or make a settlement offer directly to the plaintiffs’ lawyers, but NASCAR has not responded to those requests and, instead, filed this motion.”

23XI Racing and Front Row Motorsports

The teams argue that Mishkin possesses “significant experience in complex antitrust disputes related to sports” and has acted as an arbitrator or mediator for various international sports organizations. Furthermore, they point out that “starting over” with a new mediator is “less likely, not more likely, to lead to a resolution.” These motions come as NASCAR seeks a summary judgment to dismiss the case before the start of the trial scheduled for December 1. A hearing on that motion is scheduled for October 21. The central point of the dispute is the protection of NASCAR’s franchise system, which is fundamental to its business model. This system guarantees team owners positions in the competition and a base amount of annual income, which, according to NASCAR, has generated more than $1.5 billion in value for the teams since 2016. A year ago, most teams renewed their agreements, considering that negotiations would not lead to a better deal. 23XI, co-owned by Michael Jordan and Denny Hamlin, and Front Row Motorsports, owned by Bob Jenkins, chose to go to court.

For months, other teams have privately expressed concern about the uncertainty that the lawsuit is generating for the future of NASCAR. In the absence of progress in negotiations with Mishkin, NASCAR seeks that a federal judge, other than U.S. District Judge Kenneth Bell, who presides over the case, oversee the conversations and offer guidance on a possible resolution.

Last week, most of NASCAR’s major teams submitted statements in favor of an agreement and the protection of the franchise system. NASCAR noted in its presentation on Monday night to the U.S. District Court for the Western District of North Carolina that “the willingness of the parties to resolve this matter, along with the interests of others in the sport and the Court to see this case resolved, suggests that a judicial conciliation conference would be a significant way to facilitate a settlement.” Both sides have shown a willingness to talk, but no progress has been made. Through a judicial conciliation conference, NASCAR hopes to have a judge who can direct the conversations and offer a perspective on how a jury might interpret this complex antitrust case. The court must approve NASCAR’s request. All parties, including Michael Jordan, have expressed their openness to a deal. Jordan also stated after a hearing in August that he was willing to go to trial if necessary.

“I hope to go all the way. If I have to fight to the end, for the good of the sport, I will,” he said outside the federal court. “We have always been open to a settlement. We always have been. We have never taken that off the table.”

Michael Jordan