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Michael Jordan’s NASCAR Team Files Antitrust Suit Against Series, Claiming Unfair Practices

By  |  October 2, 2024

Two NASCAR teams, including 23XI Racing, co-owned by NBA legend Michael Jordan, have filed a federal antitrust lawsuit against NASCAR and its chairman, Jim France, claiming the sport’s charter system stifles competition. According to AP News, the lawsuit was filed on Wednesday in the Western District of North Carolina after prolonged negotiations between the teams and NASCAR over revenue-sharing and operational agreements.

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    The suit, brought by 23XI Racing and Front Row Motorsports, claims that NASCAR’s current charter system unfairly binds teams to its organization, tracks, and suppliers. “The France family and NASCAR are monopolistic bullies,” the teams stated in their lawsuit, a copy of which was obtained by AP News. The teams argue that NASCAR’s actions limit their ability to compete fairly, ultimately harming drivers, sponsors and fans.

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    The conflict centers on the charter system introduced by NASCAR in 2016. Designed as a form of revenue-sharing, it guaranteed 36 teams entry into every Cup Series race. However, the lawsuit claims the system has only benefited a select few while driving other teams out of the sport. As the plaintiffs pointed out, only eight of the 19 original charter holders from 2016 are still involved in NASCAR. Furniture Row Motorsports, for instance, sold its charter for $6 million just a year after winning the Cup Series championship, indicating the difficulties in sustaining profitability under the current model.

    Read more: NASCAR Teams Retain Top Antitrust Lawyer Amid Revenue Dispute

    Per AP News, this lawsuit follows NASCAR’s presentation of a final offer for a new revenue-sharing model in September. Out of 15 charter-holding organizations, 13 agreed to the terms, with many stating they felt coerced into signing. However, 23XI Racing and Front Row Motorsports refused, opting to hire renowned antitrust attorney Jeffrey Kessler. Kessler is known for his legal work in North American sports, including his role in the landmark equal pay settlement for the U.S. women’s national soccer team.

    The teams are seeking an injunction to allow them to compete in 2025 under new terms while the litigation is underway. They also aim to uncover details from NASCAR regarding its alleged exclusionary practices. If successful, the teams intend to pursue treble damages for anti-competitive conditions that have persisted since the charter system’s introduction in 2016.

    Michael Jordan, who joined NASCAR as a team owner in 2020, spoke out on the issue. “Everyone knows that I have always been a fierce competitor, and that will to win is what drives me and the entire 23XI team each and every week out on the track,” Jordan said, according to AP News. “Today’s action shows I’m willing to fight for a competitive market where everyone wins.”

    Source: AP News