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NASCAR Moves to Dismiss Antitrust Lawsuit Filed by 23XI Racing

By  |  December 3, 2024
NASCAR Moves to Dismiss Antitrust Lawsuit Filed by 23XI Racing

NASCAR has taken formal action to counter an antitrust lawsuit filed earlier this fall by 23XI Racing and Front Row Motorsports (FRM), seeking to have the case dismissed. The sanctioning body and its CEO, Jim France, have submitted motions to a federal court arguing the lawsuit lacks legal merit and should not proceed, according to Sports Illustrated.

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    The lawsuit, initiated by the two NASCAR Cup Series teams, challenges several key business practices, including NASCAR’s acquisition of ARCA and International Speedway Corporation (ISC), as well as provisions surrounding the NextGen car and exclusive arrangements with racetracks. NASCAR, however, contends that many of these claims are invalid due to statutory time limitations, as most of the cited events occurred over four years ago.

    In its filing on December 2, NASCAR specifically addressed the 2025 Charter’s release of claims and noncompete clauses, which are among the few aspects of the lawsuit that fall within the statute of limitations. The organization argued that these provisions do not represent antitrust violations because the teams in question did not sign the Charters and therefore cannot claim antitrust injury based on their dissatisfaction with contractual terms. Sports Illustrated reports that NASCAR further claimed the lawsuit fails to establish exclusionary conduct, asserting the organization has not refused to work with the plaintiffs.

    Related: Michael Jordan’s Racing Team Drops Antitrust Appeal Against NASCAR

    NASCAR also took aim at the market definition proposed by 23XI and FRM. Per the sanctioning body, antitrust law does not allow plaintiffs to frame a relevant market around post-investment scenarios, especially when the risks associated with entering the market were clear from the outset. NASCAR maintains that its business practices have not diminished competition and, in fact, have provided financial benefits to teams.

    “For instance, Plaintiffs concede the Charters are ‘worth millions of dollars,’ and NASCAR increased the revenues available to teams after the last round of negotiations,” NASCAR stated in its legal memorandum. According to the filing, this behavior contradicts claims of market manipulation, arguing it demonstrates a collaborative rather than monopolistic approach.

    Separately, Jim France, also named in the suit, has filed a motion to dismiss his individual involvement. His legal team argues that he has been improperly included in the lawsuit and that the claims against him are not substantiated.

    Source: Sports Illustrated