MJ is a legend on the court, but now he's headed into the courtroom. 23 XI Racing, which is owned by
Michael Jordan and NASCAR driver Denny Hamlin, has filed an antitrust lawsuit against NASCAR accusing the sport's sanctioning body of operating as an illegal monopoly. Back in 2020, the NBA legend announced that he was starting a NASCAR Cup Series team along with current Joe Gibbs Racing driver Hamlin. His 23XI Racing team currently fields the #23 car for Bubba Wallace and the #45 car for Tyler Reddick, and in the team's short history has already won 7 races, with Reddick currently in the playoffs and competing for a championship. But recently, Jordan and his team have been at odds with NASCAR over a proposed charter agreement for 2025 and beyond. NASCAR introduced its first charter system back in 2016, which would grant a set number of charters (currently at 36) that would guarantee teams would be able to compete in every Cup Series race. The thinking behind the system was that it would provide stability for teams when it comes to selling sponsorship: Cars would be guaranteed a spot in the race, so it would be easier for their teams to find a sponsor when there was no risk that they wouldn't qualify for the race. But that original agreement expires after this season (after being extended in 2020), and teams have been working to negotiate a new agreement that would provide a greater share of television revenue to the race teams, among other improvements that they were seeking to help improve their own financial stability. Of course NASCAR pushed back on many of the requests by teams, giving them an increased share of the TV revenue but not meeting the number that some team owners (like 23XI Racing team owner Denny Hamlin) claims is necessary for teams to break even. And the proposed agreement presented by NASCAR also reportedly included a non-disparagement clause, preventing the teams from publicly criticizing the sanctioning body, as well as a provision that allowed NASCAR itself to own charters and run their own teams. There's been a lot of back and forth, including criticism of NASCAR in the media, but eventually NASCAR presented team owners with what they said was their best deal and gave them an ultimatum: Sign it before the playoffs start, or we'll take your charters. Well the playoffs started last month at Atlanta Motor Speedway, and 13 of 15 NASCAR teams decided to just bite the bullet and sign the agreement, although many of them didn't exactly sound thrilled with the deal they got. https://twitter.com/JennaFryer/status/1833603061916340434 https://twitter.com/KellyCrandall/status/1832480647736098987 One anonymous NASCAR team owner (widely speculated to be Richard Childress) even called NASCAR a "communist regime." https://twitter.com/BrakeHardBlog/status/1832962456957624729 But while a majority of the NASCAR teams decided to fall in line, there were two that held out: 23XI Racing and Front Row Motorsports. 23XI Racing has been the most outspoken of the teams about what they perceive as unfairness in the process and in the new charter agreement, and Jordan's business partner Curtis Polk, who also has an ownership interest in the team, even wore a sign on his shirt recently expressing his displeasure with NASCAR: https://twitter.com/Jordan_Bianchi/status/1830360231072997468 And speaking to the media ahead of Atlanta, Polk acknowledge that the two teams were facing an uphill battle:
"NASCAR has consistently refused to deal with 23XI in these negotiations. We are David facing Goliath, NASCAR has superior bargaining power and undue influence over the sport and the charter process...
This isn’t the 1960s, and these predatory practices will not withstand scrutiny and be accepted in 2024."
But until today, it wasn't really clear how the teams and NASCAR planned to move forward in the stalled negotiations.
Well, now it's clear: 23XI Racing and Front Row Motorsports are suing NASCAR and its owner, the France family.
The lawsuit filed today accuses NASCAR and CEO Jim France of "unlawful monopolization of premier stock car racing in order to enrich themselves at the expense of the premier stock car racing teams."
The teams cite NASCAR's ownership of many of the tracks at which it races, as well as requirements that teams buy their parts from suppliers chosen by NASCAR, as proof that the sanctioning body has a monopoly on the sport of stock car racing.
According to the lawsuit:
“The France family and NASCAR are monopolistic bullies. And bullies will continue to impose their will to hurt others until their targets stand up and refuse to be victims. That moment has now arrived.” Speaking on the litigation, Jordan said he felt it was important to ensure that the market remains competitive:
“Today’s action shows I’m willing to fight for a competitive market where everyone wins. 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. I love the sport of racing and the passion of our fans, but the way NASCAR is run today is unfair to teams, drivers, sponsors, and fans.” The teams plan to seek an emergency injunction which will allow them to compete as a chartered team in 2025 while the lawsuit is pending. https://twitter.com/23XIRacing/status/1841463742216786316 It'll be interesting to see if the litigation makes NASCAR more willing to negotiate a charter agreement that's more favorable to teams. NASCAR is a privately-held company. They've never had to make their finances public, so chances are they aren't in any hurry to turn their books over to teams and have all of that become public information. That could force NASCAR back to the negotiating table and give 23XI the leverage it needs to get a better deal. Or, the whole thing could piss off NASCAR and cause them to try to revoke the team's charter entirely. Who knows at this point. Either way, the whole thing just got a whole lot messier.
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