Did You Notice? … A multi-million dollar lawsuit filed by 23XI Racing and Front Row Motorsports against NASCAR remains on pace for a Dec. 1 trial date?
After last week’s settlement efforts between both sides fell short, a tornado that would blow the very fabric of the sport wide open sits less than five weeks away.
Let’s stop and remind everyone how we’ve gotten to this point. 23XI and FRM refused to sign the new, seven-year charter agreement between Cup Series teams and NASCAR that took effect at the beginning of the 2025 season. According to 23XI/FRM, the terms were unfair and forced upon them through a 24-hour, Friday, Sept. 6, 2024, deadline from NASCAR executives tired of negotiating.
These charters, first established in 2015, are a step toward long-term franchising, similar to how stick-and-ball sports like Major League Baseball, the NFL, etc. operate. Unlike those sports, NASCAR has always held absolute power over its race teams as a family-owned entity; the race teams don’t have an equal stake in the sport. These charters, which guarantee the owners who have them a spot in all 36 Cup races, gives them a tangible piece of NASCAR that grows in value — charter sales have ballooned from a few million in their infancy to a reported $45 million in recent years.
That financial security is what 23XI/FRM claim they’re looking for, with permanent charters that give more leverage over NASCAR’s long-term direction. The terms of the current agreement, they claim, are unfairly tilted in NASCAR’s direction. The charters are still not “set in stone” beyond 2031, limiting their place at the table and proving the sport is a monopoly, cementing their complete control of stock car racing in America.
NASCAR, for its part, disagrees with that assertion, calling the current agreement “undeniably fair.” It points to increased payments to chartered teams under the new deal and 13 other Cup Series organizations, totaling 30 cars on the grid, who signed without public complaint. In fact, NASCAR filed a counterclaim against 23XI and FRM, insinuating the teams were colluding against it, forcing an increase in payments beyond what was reasonable in the new deal.
That counterclaim was officially thrown out Tuesday (Oct. 28) by Judge Kenneth Bell, who made clear the sport has not suffered any type of “antitrust injury” or financial distress as a result of the 23XI/FRM’s conduct. That leaves the 23XI/FRM lawsuit toward NASCAR as the only one currently moving forward.
And move forward, it shall go, at least for now despite a Tuesday NASCAR statement that indicated it’s open to settling.
“We respect the Court’s decision,” NASCAR said, “Though we respectfully disagree with its legal reasoning. Our priority remains resolving this matter quickly so all parties can focus on Championship weekend and continuing to grow the sport. Should a resolution not be reached, we intend to appeal the decision at the appropriate time.”
The Athletic then followed with an article indicating a settlement is, indeed, still possible. The goal, according to sources, would be to announce a deal before a Championship Weekend where a potential Cup champion (Denny Hamlin) would be taking the trophy from, then shaking the hand of a NASCAR Commissioner he’s openly suing.
Just think about that for a second. The actual champion of the sport smiling in a photo with NASCAR, side-by-side as the face of the sport, then one month later openly trying to rip it apart in court. As the kids these days would say: big yikes.
The ugliness of this case has been on full display for months, from NASCAR ripping charters from 23XI/FRM while they battle the case to ugly text messages and dirty tactics leaving just about everyone with egg on their face. Legal fees for this battle have totaled up to $100 million, which math tells us is roughly two times as much as a current NASCAR charter is worth (The Athletic claims an impasse of who’s going to pay those legal fees led to settlement talks breaking down in late October). What a boatload of money spent in a courtroom, instead of marketing and helping grow a sport whose playoff ratings are down over 20% this year.
That’s led to increased concern among race teams who did sign this deal, wondering what the endgame of this whole lawsuit is (many of them openly pushed 23XI/FRM to settle in an early October court filing). If NASCAR is willing to concede to permanent charters, while settling with 23XI/FRM and providing more money to race teams in a restructured deal … what else is it even fighting for?
The answer is explosive: a win by 23XI/FRM at trial threatens to blow up the entire sport. As Judge Bell himself has said to both sides, a wild series of scenarios could happen if NASCAR is ruled to be a monopoly and the teams win the case.
The sport could:
- Be forced to sell its racetracks to outside investors
- Have the entire charter system invalidated, blowing the rules of competition wide open
- Have the below “track ban” invalidated in a move that could encourage the formation of a rival league
It’s like throwing a keg of dynamite in the living room, walking out the door, blowing it up and seeing what happens to your house. That’s not exactly reassuring for the other race teams involved in the sport, 75% of whom (according to 23XI/FRM’s trial brief) lost money with their NASCAR teams in 2024.
You do that type of thing as a last resort when you don’t trust the leadership in place controlling that long-term trajectory. And that’s the one thing a settlement wouldn’t change: the France family, then Steve Phelps on down would still be the ones manning the ship here. A ship that has fallen prey this year to lower ratings, mounting playoff criticism and a Next Gen car that’s suffered through its fair share of challenges in year four.
Would blowing things up, letting the tornado run through town, kick all those people out? Of course not. But it would force a total rebuild, fundamentally changing a sport whose resistance to change is legendary. And the visions of such a change can feed egos, from the most fiery competitor sports have ever seen in Michael Jordan to a lawyer, Jeffrey Kessler, who’s won cases which fundamentally changed the way entire sports leagues operate (see: NCAA, NFL, among others).
Establishing that legacy is something no amount of money can buy. The dopamine hit is addicting, fueled by uncertainty and the very real problems NASCAR faces regardless of if there’s a settlement here in 24 hours or 24 days. All sides will need to come together and believe in each other to heal and grow the sport.
But if that belief is not there? If neither side can live with each other? That’s how divorces happen. That’s how monumental change occurs.
The tornado gets closer with each passing day. Do the right people actually want it stopped?
Follow Tom Bowles on X at @NASCARBowles
The author of Did You Notice? (Wednesdays) Tom spends his time overseeing Frontstretch’s 50+ staff members as its majority owner and Editor-in-Chief. Based outside Philadelphia, Bowles is a two-time Emmy winner in NASCAR television and has worked in racing production with FOX, TNT, and ESPN while appearing on-air for SIRIUS XM Radio and FOX Sports 1's former show, the Crowd Goes Wild. He most recently consulted with SRX Racing, helping manage cutting-edge technology and graphics that appeared on their CBS broadcasts during 2021 and 2022.
You can find Tom’s writing here, at CBSSports.com and Athlonsports.com, where he’s been an editorial consultant for the annual racing magazine for 15 years.
A great summary of the state of the lawsuit.
Agreed, very good article, pointing out many issues we all see, yet NASCAR doesn’t. Maybe better said, they know about but don’t wish to change, which this lawsuit would force them to do, and being the Big Bully, they resent that.
The unintended consequence of a victory by Jordan could be the devastating part though..??
We’ll see. Courts are funny. Appellate courts are not.
I’m not advocating one way or the other here, just posing a question to ponder; With the current state of NASCAR, the evolution of society away from traditional “cars” (toward SUVs, Trucks, or even electric vehicles), general discontent from fans regarding the current on track product and playoff system, plus a 20% drop in ratings, perhaps monumental change needs to happen in order to save the series?
I think the V8 engine is awesome. Racing that motor will be around for awhile I assure you.
I agree and also love V8’s, but NASCAR I think is at a crossroads with where they need to be with their racecars since only Toyota still makes a sedan (although V6 only unless you’re talking Lexus). Ford has the Mustang, and Chevrolet has the Corvette. In reality, these 3 vehicles on the street are very different from each other, and I think that puts NASCAR in a bit of a bind. Short of a spec body with different engines (kinda like Indycar) I’m not sure how best they move forward. That change would certainly not appeal to the manufacturers who still – I assume – want to see something that resembles their product on the track. But a Corvette against a Camry isn’t a realistic race pairing. At least the Mustang / Camaro had a long-standing rivalry on the streets. Camry was a better fit when they were still racing the Fusion and LS sedans. It’s slowly becoming weird with what is still being built and available to market on track.
Charters are the worst idea that NASCAR has had/the worst thing they have ever agreed to. The sole purpose of the charters is to limit the ability of new teams to enter enter the sport.