Michael Jordan, NASCAR court battle underway in Charlotte this week: Understanding the case

CHARLOTTE, N.C. (WBTV) - A legal battle between NASCAR and two race teams -- which also involves Michael Jordan -- entered federal court in Charlotte, North Carolina this week.

An antitrust trial began on Dec. 1 in connection with a 2024 federal lawsuit filed by Front Row Motorsports and 23XI Racing against NASCAR and its CEO Jim France. 23XI Racing is co-owned by Michael Jordan and Denny Hamlin.

The lawsuit came after Front Row Motorsports and 23XI Racing were the only two Cup Series teams that refused to sign NASCAR’s charter agreement back in September 2024.

In their lawsuit, Front Row Motorsports and 23XI Racing alleged the France family created an “unlawful monopolization” of stock car racing over the course of several years.

The jury trial kicked off this week at the U.S. District Court for the Western District of North Carolina, located in Charlotte, despite attempts to reach a settlement beforehand.

Here’s a breakdown of the lawsuit and situation leading up to the antitrust trial.

Understanding the lawsuit

NASCAR’s charter system was first introduced in 2016. Initial agreements ran through 2020, at which time teams could choose to re-enter for another four years.

At the end of 2024, a new agreement was set to take effect for the following year and beyond.

During negotiations for the new agreement, Front Row Motorsports and 23XI Racing accused NASCAR and Jim France of “[using] its monopsony power to impose a new set of anticompetitive terms on the racing teams and generate further monopsony profits for the France family.”

The teams filed a lawsuit against NASCAR in October 2024.

The lawsuit said NASCAR was initially negotiating jointly with teams before it eventually ended joint negotiations and started negotiating charter agreements with teams individually.

“The individual negotiations with the racing teams were completely one-sided, as NASCAR refused to budge from any of its core negotiating demands,” the lawsuit claimed. “Then, with little warning, NASCAR sent a final, take-it-or-leave-it version of the 2025 Charter Agreement to the teams at approximately 5:00 p.m. on September 6, 2024, and told the teams they had a 6:00 p.m. deadline to sign the more than 100-page agreement or risk not having a charter for 2025.

“After initial outrage from the teams, Jim France and other members of NASCAR’s senior leadership started calling the teams to tell them NASCAR would extend the signing deadline to midnight, but it would eliminate the charter system altogether for 2025 and beyond if a substantial number of teams did not sign by that deadline,” the lawsuit continued.

The lawsuit claimed that teams knew that if they did not sign the charter agreement, fielding a car was so expensive that “it would be economically devastating for most of them to compete without the stability provided by the charter system,” and that the discontinuing of the system would cause “a complete loss of their enterprise values.”

“Faced with a take-it-or-leave-it offer, and no competing opportunity for premier stock car racing in the United States, most of the teams concluded that they had to sign,” the lawsuit read.

You can read the full lawsuit down below.

Front Row Motorsports and 23XI Racing were the only two out of 15 organizations that did not sign extensions for the new charter agreements.

Why charters matter in NASCAR

Charters matter to NASCAR teams for several reasons, but the most apparent is that they guarantee entry into every race.

There are 36 charters with a maximum race field of 40 cars. That means that for the 36 cars covered by charters, they are guaranteed to race. Cars that are not chartered are considered “open” entries, and are not guaranteed a spot in the 40-car field.

Most Cup Series races do not exceed the 40-entry maximum -- but for those that do, such as the annual Daytona 500, teams want to be locked into the race.

Charters also matter because they are a source of revenue sharing. Without that money, teams have to rely only on sponsorship money and race winnings.

Prior to the charter system, such a model left teams “in a constant state of financial vulnerability,” the lawsuit claimed.

Jeff Gluck, a motorsports reporter for The Athletic, said he believes teams that operate without charters bring in only one-third of the money a chartered team would each race week.

For reference, Gluck estimated that each charter is worth $40-$50 million.

Where things stood before the trial

After choosing not to sign the latest charter agreement, Front Row Motorsports and 23XI Racing both reportedly filed injunctions to still be recognized as chartered teams while the legal battle continues.

According to the Associated Press, those injunctions were denied in September, by the same judge who denied a temporary restraining order that requested the same benefits in July.

With the judge denying the teams the ability to be recognized as chartered cars, 23XI and Front Row have competed as open cars in recent races, which comes with significantly reduced prize money. It’s believed the two racing teams will go out of business without the charters.

Front Row Motorsports and 23XI Racing both had three full-time entries, meaning six total charters were out of use, as of October this year.

In August, the AP reported that NASCAR said in a court filing that it had planned to sell one of the six charters to a team ahead of the 2026 season. NASCAR later reportedly promised the court it would not re-distribute any charters until after the case settles.

U.S. District Judge Kenneth Bell ruled in favor of the racing teams in early November, finding that NASCAR does have monopoly power in a “properly defined market.”

“This means that the trial can now be focused on whether NASCAR has maintained that power through anticompetitive acts and used that power to harm teams,” said Jeffrey Kessler, who is representing 23XI and Front Row. “We’re prepared to present our case to the jury and are focused on obtaining a verdict that benefits all of the teams, partners, drivers, and the fans.”

NASCAR has disputed anticompetitive claims.

“NASCAR looks forward to proving that it became the leading motorsport in the United States through hard work, risk-taking, and many significant investments over the past 77 years,” NASCAR said in a statement last month. ”The antitrust laws encourage this — and NASCAR has done nothing anticompetitive in building the sport from the ground up since 1948.

Teams, NASCAR failed to reach settlement

With the case scheduled to go before a jury in federal court on Dec. 1, 2025 -- Front Row Motorsports, 23XI Racing and NASCAR attempted to reach a settlement through mediation.

Those mediation sessions and private negotiations were unsuccessful. The case has gone to trial, as of this week.

If NASCAR loses the trial, the entire charter system could get disbanded or overhauled -- and some teams were frustrated by that threat.

Motorsports reporter Jeff Gluck previously said he believes the result of the trial could change stock car racing forever.

“I know it’s, like, sort of hyperbole and you hear a lot in the media these days of like, this could be the biggest thing ever,” Gluck said. “But really, truly for NASCAR, this is one of the biggest stories in NASCAR history if this goes to trial and the outcome could change the sport forever. The judge has said, ‘Look, there’s a lot of options available to me. If I find that this is an illegal monopoly and I need to break NASCAR up, essentially, you don’t know what I could do.’

“The sport could look completely different,” Gluck continued. “They could make NASCAR sell all the tracks or have to have an independent officiating body or something. I mean, the whole thing could look completely different than we know it today. And so, there’s a lot of nervous, anxious people around NASCAR right now.”

Gluck also said that if the jury were to side with NASCAR during the trial, then Front Row Motorsports and 23XI Racing could go out of business.

Read the full lawsuit here

You can read the entire lawsuit filed against NASCAR and the NASCAR CEO below.

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