NASCAR Vs. 23XI/FRM Lawsuit Day 5 Recap

CHARLOTTE, N.C. — The first week of the 23XI Racing / Front Row Motorsports vs. NASCAR trial wrapped up on Friday, Dec. 5, with the case picking up at a much more rapid pace following Judge Kenneth D. Bell’s request to speed things up.

In the previous days, only two witnesses had taken the stand. But on Friday, the jury got to hear from four witnesses. NASCAR President Steve O’Donnell completed his questioning before Joe Gibbs Racing co-owner Heather Gibbs, 23XI co-owner Michael Jordan and Race Team Alliance Executive Director Jonathan Marshall served as witnesses.

O’Donnell did his questioning with the plaintiffs on Thursday, so Friday started of with the defense’s turn. He made a lot of points in NASCAR’s favor, but quite of few of them had holes poked in them when 23XI/FRM attorney Jeffrey Kessler re-examined him. For example, he brought up the zMAX CARS Tour as another stock car league and how NASCAR has allowed it to race at North Wilkesboro Speedway. However, Kessler got him to admit CARS is a regional series, which Bell said is not a premier stock car series.

Read all of Frontstretch’s content covering the NASCAR vs. 23XI/FRM antitrust lawsuit here

O’Donnell also noted that Gaunt Brothers Racing and JTG Daugherty Racing (now Hyak Motorsports) each raced a car a full season without a charter. But Kessler added on that Gaunt is no longer around, and JTG got a charter. While Gaunt did stop racing full time after one year with no charter, in actuality, JTG shuttered its car with no charter after a year of racing as an open team. O’Donnell agreed with Kessler’s point.

SRX was a topic that took up quite a bit of Friday morning. O’Donnell testified that NASCAR sent a letter to Camping World SRX Series co-owner and NASCAR Hall of Famer Tony Stewart, who co-owned a NASCAR Cup Series team at the time, asking Stewart what the series was supposed to be. According to O’Donnell, a party from SRX responded, saying SRX would be an ancillary series and would help raise the tide of all motorsports.

When Kessler asked O’Donnell about NASCAR ultimately deeming SRX as a threat, the NASCAR Commissioner said that happened when he saw Chase Elliott competing in it, driving a NAPA-sponsored car with a No. 9 stylized like his NASCAR ride. Kessler said that SRX is no longer putting on events, to which O’Donnell said it was just announced it was “coming back.” There has been no news of an SRX return, but the series has been posting on social media, including posts about this trial.

One good moment for O’Donnell was when he said the team negotiating committee was asking for $720 million, which was almost what NASCAR was getting in media rights at the time. He didn’t know how they could pay the tracks if it was paying the teams that much. He also brought up that cost caps and cost floors were and are still being considered, but that some teams haven’t agreed to them.

O’Donnell also disputed that the teams were given the charter agreements hours before they were due, saying they were sent on Aug. 30, seven days before the deadline, and that NASCAR worked with JGR and other teams to adjust some of the agreements on Sept. 6.

One interesting nugget that came out of the O’Donnell testimony is that Andretti Global did consider entering NASCAR with Honda and buying charters.

Heather Gibbs may have been the most powerful witness of the day, because despite JGR not being in the lawsuit with 23XI and FRM, a lot of her testimony aligned with things 23XI co-owner Denny Hamlin and FRM owner Bob Jenkins said in the prior days, the chief item being that she said JGR would’ve lost its charters had it not signed the agreement, using the phrase that’s been used several times this week: “They put a gun to our head.”

The daughter-in-law of Joe Gibbs starting her time on the witness stand recounting how the family got into NASCAR as well as the loss of JD Gibbs in 2019 and her husband Coy Gibbs in 2022, the morning after her son Ty Gibbs had won the NASCAR Xfinity Series championship. Heather apologized for getting emotional while telling the story, explaining that it was the first time she had publicly told it.

Gibbs talked about a conversation she and Joe had with NASCAR CEO Jim France, in which France told them, “I’m done with the conversation,” about permanent charters. He told them that, “If I wake up and have 20 charters, I have 20,” in regards to some of the teams not wanting to sign the agreement. JGR signed the agreement, and Heather explained it was because she was thinking of JD’s and Coy’s legacies.

Something that came out of Heather Gibbs’ testimony but has no bearing on the case is that JGR had to increase the money it was paying Hamlin in the recent contract extension because there was interest in his driving services from elsewhere.

Next up was the most famous person in the entire trial: Jordan. The courtroom was way more packed on Friday with a lot more media present because Jordan was set to testify. There was also a larger crowd of fans gathered outside.

The basketball legend started off explaining his lifelong love of NASCAR, saying he was a Richard Petty fan before becoming one of Cale Yarborough. He said Yarborough was the true driver of the No. 11 and apologized to Hamlin. Jordan said, “I don’t miss a race,” as he’s at about a dozen races a year and watches the rest on TV.

Being a former owner of an NBA franchise, Jordan compared its revenue sharing to that of NASCAR’s and said that the players there care more about the growth or loss of the sport because it impacts their revenue share. He said what he didn’t think was fair about the current charter agreement was no permanent charters, no governance and he felt the economics weren’t fair.

Jordan was complimentary of the France family and what it and NASCAR have achieved overall and with the charter system. He noted that he was welcomed with open arms, but that he wants to improve the league, especially in its relations with teams and drivers.

There was a humorous moment during the cross-examination, when NASCAR attorney Lawrence Buterman admitted he was a New York Knicks fan and that Jordan brought him a lot of heartbreak over the years. He did thank Jordan at the end for “making my 9-year-old think I’m pretty cool today.”

Overall, there wasn’t much said in Jordan’s testimony that will probably impact the totality of the case, but having such a big name take the witness stand, who most of the jury are at least familiar with, was a big moment in this lawsuit.

The final witness of the day was Marshall. Given his position in the RTA, which is essentially a union for the teams, he has a lot of background on the teams and the negotiations.

Marshall was quick to point out that 50 of the teams that started in the Daytona 500 in the last 20 years are no longer around, saying that big of a loss has never happened in the NBA or other sports leagues. He claimed that an MLS franchise is worth $525 million, while NASCAR charters are only worth $40-45 million, and when asked by the plaintiffs if NASCAR is more popular, he replied, “I would hope so.” Marshall said that NASCAR has the most media revenue per viewer among major sports, yet shared the least with its teams.

One thing Marshall brought up was that the RTA did a study in 2021 to see if a race in Oman was feasible, citing that there was a lot of money in the Middle East for western sports and it would be a good way for the teams to make some money. That never happened.

NASCAR had a win in the cross-examination when Buterman asked Marshall if he had ever looked at the financial information for any of the race teams. He responded with, “I don’t really want to say,” to which Buterman reminded him he’s under oath and that he had shown the jury that he is a financial expert for the teams. Marshall said that he doesn’t look at the specific costs or profits of race teams and knows more about NASCAR’s financials because it is a public company. NASCAR is a privately owned company.

Buterman later asked Marshall to compare a race team shutting down to someone selling a sports franchise. Marshall gave the example of Jeanie Buss recently selling the Los Angeles Lakers, saying, “When she sells the LA Lakers, I don’t think she’s sad. … It’s just different.” He went onto explain he’s had many race team owners as friends who were sad when they had to shut down their team.

Marshall was also asked if he recalled 23XI co-owner Curtis Polk saying that speaking negatively to media about NASCAR might help charting negotiations. Marshall didn’t answer directly.

The fifth day of the trial ended shortly after that. Marshall will resume his testimony when it resumes on Monday, Dec. 8. Team owner Richard Childress is also expected to be a witness on that day.