Michael Jordan Racing Team’s Suit Accuses NASCAR of Monopoly (1)

Two racing teams, including one co-owned by NBA legend Michael Jordan, have sued NASCAR, saying it exploited its position atop US stock car racing to extract monopoly profits.

Front Row Motorsports and Jordan’s 23XI brought the claims against NASCAR and CEO James France in a Wednesday lawsuit in the US District Court for the Western District of North Carolina. The complaint escalates a long-simmering fight inside NASCAR over revenue and how it’s disbursed among racing teams.

NASCAR is accused of achieving its dominance thanks to anticompetitive and exclusionary practices that ultimately leaves many teams, even the most successful, financially vulnerable. NASCAR has created that environment by imposing anticompetitive terms on teams, including noncompete agreements preventing them from participating in races outside the NASCAR circuit, 23XI and Front Row allege.

“By blocking the formation or growth of any competing premier stock car racing series, NASCAR has been able to force the teams to accept take-it-or-leave-it economic conditions in order to compete at the highest level of stock car racing in the United States,” the lawsuit said.

NASCAR didn’t immediately return a request for comment.

NASCAR, the top motorsport league in the US, is distinct from other major professional sports leagues, which are owned and operated by the teams. NASCAR, by contrast, has always been privately owned by the France family, whom the complaint refers to as “monopolistic bullies.”

Front Row and 23XI said the lawsuit was motivated by failed negotiations between NASCAR and racing teams over a new charter agreement. After refusing to compromise on any of its positions, NASCAR on Sept. 6 sent a “final, take-it-or-leave-it” charter, with the added threat that it would eliminate the charter system if a “substantial number” of teams didn’t sign, according to the complaint.

The charter, which goes into effect in 2025, includes a provision barring teams from participating in any automobile or truck racing series not sanctioned by NASCAR and requires teams to relinquish any legal claims it may have related to the charter, according to lawsuit.

Most teams signed the agreement out of fear of the economic consequences if they didn’t, Front Row and 23XI said. Past charters have guaranteed chartered teams entry into every “Cup Series” race for the term of the charter agreement.

“Plaintiffs are the only two racing teams who did not bow down to NASCAR’s pressure,” Front Row and 23XI said.

23XI, whose owners include Jordan and NASCAR driver Denny Hamlin, began racing in the Cup Series under its first charter in 2021 with a “23" car driven by Bubba Wallace. Front Row was founded in 2004 and runs two full-time cars in the Cup Series.

“It has become evident that this antitrust litigation is the only way to free up the market for competition and enable plaintiffs, and other stock car racing teams, to obtain the fair charter terms that will be realized in a competitive market for their services as top-tier stock car racing teams,” the teams argued.

The lawsuit seeks, among other relief, treble monetary damages for harm suffered during the past four years due to NASCAR’s alleged anticompetitive conduct.

23XI and Front Row Motorsports are represented by Winston & Strawn.

The case is 2311 Racing LLC v. NASCAR, W.D.N.C., 3:24-cv-00886-FDW-SCR, 10/2/24.