NASCAR Vows Not to Reallocate Charters Amid Legal Dispute
NASCAR has assured a federal court that it will not redistribute any franchise (charters) pending the resolution of the antitrust lawsuit filed by two racing teams. One of them is owned by Michael Jordan. The presentation on Friday in the Western District of North Carolina comes one day after a heated hearing. In it, 23XI Racing and Front Row Motorsports argued for a preliminary injunction to have six charters restored to them until the jury trial, scheduled for December 1st. In multiple presentations, NASCAR had indicated its intention to immediately redistribute the charters. In addition, it had an interested party with which it could negotiate immediately. A charter is the equivalent of a franchise in other sports. 23XI and FRM refused to sign the agreements last September and, instead, sued NASCAR. They accused the motorsports series, owned and operated by the France family, based in Florida, of being abusive and monopolizing the car racing market. There are 36 charters for a 40-car field. U.S. District Judge Kenneth Bell repeatedly asked NASCAR why it couldn’t take one of the four “open” entries to sell to an interested buyer, or devise a contingency plan that would leave room to return charters to 23XI and FRM if NASCAR lost in the trial. The original four “open” charters are reserved for any potential new manufacturer entering the sport. With the six from the two teams that are demanding, there are technically 10 “open” charters at the moment. 23XI, owned by basketball legend Jordan and three-time Daytona 500 winner Denny Hamlin, and Front Row, owned by businessman Bob Jenkins, want to be recognized as franchisees for 2025 to receive significantly higher payments than they receive as “open” teams. Bell said that he would rule on the injunction next week. However, NASCAR’s presentation on Friday calms the urgency somewhat, as the France family has pledged not to sell the charters, a move that, according to the teams, would put them out of business. NASCAR said its commitment was voluntary and was made out of “NASCAR’s desire to focus on both the growth of the sport for the 2026 Cup Series season and preparation for the trial.” In the presentation, NASCAR said it will not “issue, sell, transfer, or lease any additional franchises for the 2025 Cup Series season,” a statement that covers the six franchises. NASCAR also said that “it will not issue, sell, transfer, or lease more than four additional franchises for the 2026 Cup Series season.” Jeffrey Kessler, lawyer for 23XI and FRM, said that NASCAR’s promise not to sell the charters was debatable and that they will respond to the filing next Tuesday. “The plaintiffs also do not agree that the defendants’ notice and representations demonstrate that the plaintiffs do not face irreparable harm,” he said. That NASCAR stopping any possible sale of charters technically doesn’t prevent Bell from issuing the preliminary injunction to the teams, who are trying to demonstrate the irreparable harm they will face if they don’t have charters. 23XI driver Tyler Reddick has a clause in his contract that says he can leave the team if his car doesn’t have a charter, and Kessler indicated in court on Thursday that both Reddick and the sponsors have notified them that they are currently in breach. Thursday’s hearing revealed how acrimonious it has become between NASCAR and the two teams through the disclosure of emails and text messages filled with expletives from Jordan and other high-profile litigants.Of the 15 organizations with a charter in NASCAR, only 23XI and FRM refused to sign the charter extensions. Many teams have said they felt cornered by NASCAR’s final offer, which came with a deadline and the threat of revoking the charters if they didn’t sign within a day.
The teams used texts and emails to try to demonstrate how NASCAR imposed itself in a final charter agreement.One, from commissioner Steve Phelps, said: “Give them the charters, choose a date and they can sign or lose their charters, it’s that simple”.
Steve Phelps
Jordan and 23XI did not sign, and Jenkins and Front Row joined the NBA legend in the lawsuit. Jordan said outside the court on Thursday that he had been open to a settlement, but that he is willing to see the case go to a jury trial. The playoffs begin Sunday at Darlington Raceway in South Carolina and among the drivers in the 16-driver playoff field are 23XI’s Reddick and Bubba Wallace and Hamlin, who races for Joe Gibbs Racing. All three said they believe they can compete fairly for the Cup Series title while the lawsuit is ongoing.Scott Prime, Vice President of Strategic Development, wrote: “We have all the leverage and the teams will almost have to sign whatever charter terms we present to them.”
Scott Prime
