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Nascar Fights Back in Antitrust Lawsuit Filed by Michael Jordan’s Racing Team

By  |  October 24, 2024

Nascar is pushing for an early legal win in a high-profile lawsuit brought against it by basketball legend Michael Jordan and other stock car team owners. The plaintiffs, which include Jordan’s 23XI Racing and Front Row Motorsports, accuse Nascar of monopolizing the stock car racing industry and denying teams a fair share of revenue, according to a Reuters report.

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    In a court filing on Wednesday night, Nascar urged a federal judge in Charlotte, North Carolina, to reject the teams’ request to remain “charter” members while they pursue their lawsuit. The legal dispute, filed earlier this month, alleges that Nascar and its CEO Jim France have violated U.S. antitrust laws by imposing restrictive conditions on teams, aimed at limiting competition from other racing organizations.

    The lawsuit claims that Nascar’s dominance in the premier stock car racing market allows it to withhold a larger share of profits, disadvantaging team owners. Jordan, who co-founded 23XI Racing in 2020 alongside veteran driver Denny Hamlin and businessman Curtis Polk, joined forces with Bob Jenkins, owner of Front Row Motorsports, to take legal action against the racing giant. Front Row Motorsports has been part of the Nascar scene since 2005.

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    Related: NASCAR Accuses Michael Jordan’s 23XI Racing of Using Antitrust Suit for Contract Renegotiation

    At the heart of the dispute is the refusal of both teams to sign Nascar’s latest charter agreement. According to the plaintiffs, this new agreement would prevent them from taking legal action against the league. Chartered teams in Nascar enjoy guaranteed spots in the coveted Cup Series races, including those held at iconic venues like Daytona International Speedway. Non-chartered teams, however, must compete as “open” teams, fighting for limited slots in the top-tier events.

    The lawsuit also seeks an injunction to allow the two teams to continue racing as chartered members through 2025 while their legal case unfolds. The plaintiffs argue that Nascar, founded in 1948, is leveraging its power to impose “one-sided economic terms” far less favorable than what teams could secure in a more competitive environment.

    However, Nascar contends that the lawsuit is not about promoting fair competition but rather an attempt by the teams to extract more revenue than they could achieve through negotiations. “This lawsuit is not about protecting competition; it’s a bid by plaintiffs to secure more money than they could through arm’s-length negotiations,” Nascar argued in its Wednesday filing. The league also defended its right to decide how revenue is shared, emphasizing that antitrust laws do not oblige successful sports organizations to admit every team that wishes to participate.

    As of Thursday, neither Nascar nor the plaintiffs’ legal representatives have responded to requests for comment.

    The case, titled 2311 Racing LLC d/b/a 23XI Racing and Front Row Motorsports Inc v. National Association for Stock Car Auto Racing LLC and James France, is being heard in the U.S. District Court for the Western District of North Carolina.

    Source: Reuters