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11/30 16:37 CST Michael Jordan's fight against NASCAR heads to court, could
shake up motorsports
Michael Jordan's fight against NASCAR heads to court, could shake up motorsports
By JENNA FRYER
AP Auto Racing Writer
CHARLOTTE, N.C. (AP) --- Michael Jordan's bitter fight against NASCAR heads to
federal court Monday in a jury trial that could rip apart the top motorsports
series in the United States.
The antitrust allegations leveled by Jordan-owned 23XI Racing and Front Row
Motorsports has exposed salacious personal communications, NASCAR's finances
and a deep contempt between some of the top executives in the sport and its
participants.
Three-time Daytona 500 winner Denny Hamlin, who owns 23XI alongside Jordan and
less than a month ago had the Cup Series championship slip through his fingers,
warned this weekend that the gloves will be off during the two-week trial in
the Western District of North Carolina.
"Our fans have been brainwashed with (NASCAR's) talking points for decades,"
Hamlin wrote on social media. "Lies are over starting Monday morning. It's time
for the truth. It's time for change."
NASCAR Commissioner Steve Phelps has said that the series has tried hard to
settle the case ahead of Monday's trial.
What is the lawsuit about? The lawsuit was filed by 23XI Racing, which is owned by Basketball Hall of Famer Jordan, Hamlin and Jordan's longtime business manager, Curtis Polk. They were joined by Front Row Motorsports, a team owned by entrepreneur Bob Jenkins that won the 2021 Daytona 500. The two were the only teams out of 15 to refuse to sign renewals on the charter agreements NASCAR presented to them in late 2024. All 15 teams had been fighting for more favorable terms in the charter agreements over more than two years of negotiations, and the final terms fell short of what the teams had been seeking. 23XI and Front Row accused NASCAR of being a monopoly and sued under antitrust grounds. What is a charter? The charter system was introduced in 2016 and is NASCAR's version of the franchise model used by most other professional sports leagues. Being chartered guarantees that car a spot in the 40-car field for all 38 races, as well as a defined payout from the weekly purse. Even with the charters, the teams have argued that the revenue model is not viable. The teams wanted the charters to become permanent (they are renewable and revocable), a larger percentage of revenues and a voice in governance. 23XI and Front Row felt the new charter agreements fell short of meeting those demands and refused to sign. The two organizations argue NASCAR holds too strong of a hold on all aspects of the racing series and allege a monopoly based on exclusivity clauses, ownership of most of the race tracks on the Cup schedule, and its control of the rules and regulations. 23XI and Front Row are now also pursuing a large monetary sum from NASCAR to cover their legal fees and financial losses suffered this year from not being chartered plus the lawsuit. NASCAR's defense NASCAR was founded 76 years ago by the Florida-based France family and says it has not violated antitrust law because it has done nothing to restrain trade beyond normal business practices. NASCAR has argued that payouts in the 2025 charter agreement increased and prove it is not anticompetitive. NASCAR has also cited the option for cars to enter races as "open teams" and try to make the field in one of four nonchartered spots on qualifying speed. 23XI and Front Row have been open teams, and while their combined six cars made every race, it cost both organizations millions of dollars in purse money. The pretrial discovery process revealed NASCAR made more than $100 million in 2024. Behind-the-scenes drama The discovery phase has been brutal for both sides with the exposure of unseemly personal communications from top NASCAR executives as well as the two teams. Phelps was among leadership who in a discussion with other NASCAR executives called Hall of Fame team owner Richard Childress a "dinosaur," an "idiot" and a "stupid redneck." The discussion also included a reference that Childress "owes his entire fortune to NASCAR" and needed "to be taken out back and flogged." Another NASCAR executive alleged that fans of the sport can't read, and multiple series leaders admonished Hall of Fame driver Tony Stewart's summer short-track series, SRX, and threatened to have it killed because NASCAR drivers were participating. On the other side, the president of 23XI was found to have said NASCAR chairman Jim France had to die in order to receive favorable charter terms, Hamlin admitted his dislike for the France family, one of Jordan's advisers said Hamlin wasn't a good businessman and Jordan joked that he loses more money in a casino than he pays one of his drivers. Who will be in court? NASCAR has indicated it wants Rick Hendrick and Roger Penske, the two most powerful team owners in the United States, and neither Hall of Famer wants to testify. They both filed a motion asking not to even be deposed, and if they must be, then the questioning must be limited to charters. Hendrick and Penske are among a large group of owners who submitted declarations on NASCAR's behalf in defense of the charter system. The declarations showed unity among the non-suing teams, who do not want the charter system to be disbanded, which could happen if NASCAR loses the case. But, what NASCAR doesn't spotlight is that many of the team owners still noted that the 2025 charter agreements are still short of all their asks. Additionally, NASCAR has asked that Polk and Hamlin of 23XI not be allowed to sit in court ahead of their testimony. A ruling on that had not been made as of Sunday early evening. Jordan, a North Carolina native who led the University of North Carolina to a national championship and once owned the NBA's Charlotte Hornets, received an exemption to be in the courtroom for the entire jury. A spokesperson for the two teams said that Jordan and Jenkins plan to be the faces of their case. What are some outcomes The case could still be settled at any time, even if a ruling is made and it goes to appeal. If 23XI and Front Row win, the jury will determine actual monetary damages and Judge Kenneth Bell can adjust the figure and even triple it. Bell also would be charged with unraveling any found monopoly. Among the threats to NASCAR are orders that the France family sell the sport, sell the tracks it owns, dismantle the charter system, order permanent charters --- anything is possible. If NASCAR wins, it is unlikely that 23XI and Front Row stay in business beyond 2026 and the six charters being held aside likely will be sold to other interested parties. The last charter sold went for $45 million, and NASCAR has indicated there is pressing interest from potential buyers including private equity firms. ___ AP auto racing: https://apnews.com/hub/auto-racing |
