The antitrust case between Michael Jordan‘s 23XI Racing and NASCAR will completely change the sport of what we know it as today, no matter the rulings handed down.
The NBA icon and team co-owner Denny Hamlin, alongside Front Row Motorsports, have accused NASCAR of anti-competitive practices and establishing a monopoly in North American motorsports.
As proceedings continue for the next two weeks, the court has already heard emotionally charged witness statements and explosive, unsealed text messages have highlighted a deep and bitter divide between NASCAR executives and team owners.
READ MORE: England great dies days after addressing Lions squad
READ MORE: Tigers CEO’s ‘papers have been marked’ as club implodes
READ MORE: $25m Gallen blueprint driving NRL giant’s eye-catching switch
As the stakes rise in the North Carolina federal courtroom, the future of the sport hangs in the balance.
NASCAR and Michael Jordan’s 23XI Racing are locked in battle. Getty
What is an antitrust case?
By definition, antitrust laws are regulations to prevent the concentration of economic power in regards to monopolies and other anticompetitive practices.
In sport, they create a set of rules that stop one entity owning the entirety of a sport and the money made from it.
Michael Jordan, co-owner of 23XI Racing, departs the Charles R Jonas Federal Building. Getty
Jordan joined NASCAR in 2020 with 23XI (named twenty-three eleven) with co-owner Hamlin.
Hamlin himself races in the NASCAR Cup Series with Joe Gibbs Racing and is set to become a future NASCAR Hall of Famer as a three-time Daytona 500 winner with 60 race wins under his belt.
In 2024, they joined forces with Front Row Motorsports to file an antitrust lawsuit against the France family – who own and operate NASCAR – for employing monopoly powers to restrict race team revenues and independence.
NASCAR owns 17 different tracks in America, 11 that the Cup Series races at, including the iconic Daytona track.
23XI and Front Row Motorsports claim this limits growth and potential expansion into other markets.
Denny Hamlin with the Daytona 500 trophy. Getty
They also say that NASCAR’s control over team’s business as well the entirety of American motorsports – NASCAR owns ARCA stock car series and IMSA endurance championship – doesn’t allow teams to go stock car racing anywhere else should they want to do so.
The plaintiffs’ attorney, Jeffrey Kessler, said that a NASCAR-commissioned study found 75 per cent of teams lost money in 2024.
The two teams believe this is all a violation of antitrust law. But the reality is that this is all just the beginning.
NASCAR’s charter system
The real fight is rooted in the structure of NASCAR’s charter system, where 23XI and Front Row believe the governing body is being unfair and limiting value potential when it comes to revenue distribution among teams.
The charter system, created in 2016, guaranteed each car a spot in the field each race week as well as a percentage of the purse, handing team owners an asset to sell should they want to get out of the business.
Denny Hamlin and Michael Jordan co-own 23XI Racing in the NASCAR Cup Series. Getty
This is standard in motorsport. For example, Supercars has a version called a Teams Racing Charter, Formula 1 has the Concorde Agreement. It guarantees a spot on the grid and a cut of revenue, including broadcast money.
NASCAR attorneys argued that the charter system has created $2.28 billion AUD in equity for the 36 chartered teams.
Prior to the charter system, teams raced “open,” with no guarantee they’d make the field or earn a pay out.
In 2024, the next charter was set to be signed and run alongside the NASCAR’s broadcast deal that would go through to 2031.
On September 6, 2024, teams received the final NASCAR proposal for their charter and were told they had until midnight to sign it.
It was revealed in court that the agreement was short of “minimum eight points” and when asked to change this, NASCAR revealed that “negotiations are closed.”
23XI and Front Row refused to sign by the midnight deadline, questioning the sizes of the revenue distribution pay outs as well as the failure to agree on permanent charters.
They then put forward the antitrust case in October of the same year.
Tyler Reddick raced for 23XI Racing in 2024. Getty
Hamlin admitted the last-ditch proposal from NASCAR “had eight points minimum that needed to be changed. When we pointed that out we were told, ‘Negotiations are closed.’
“I didn’t sign because I knew this was my death certificate for the future.”
The long-anticipated court showdown will at the least alter the business model of stock car racing and, at most, tear the Cup Series garage to pieces.
Inside the court room
It’s hard to explain how wild this court case is.
Three members of the jury have already been dismissed, two for their fandom towards Jordan and one for her allegiance to Denny Hamlin’s rival, Hendrick Motorsports.
When asked about their impartiality, one of the dismissed jurors plainly said, “I like Mike” and pumped his fist at the NBA star while leaving the court room, while the other admitted he had Jordan posters on his walls growing up.
Michael Jordan is a orbital figure in the courtroom for this antitrust case. NBAE via Getty Images
Many of the jurors do not know much about the sport of NASCAR, but surely understand the serious nature of the case with an NBA legend sitting in the front row.
Hamlin was the first to take the witness stand, combatively answering questions while being cross-examined about NASCAR’s monolithic entity they are fighting.
He sparred with external counsel Lawrence Buterman repeatedly, saying that “NASCAR is a monopoly” in the courtroom and criticising the governing body’s dictatorship.
The figures being thrown around in court are eye-watering.
Hamlin admitted he makes $21.3m AUD per season for Joe Gibbs Racing, the team he drives for in the Cup Series.
The NASCAR field could be completely blown open in this court case. Getty
He has personally invested $15.2m into 23XI Racing, but owes Jordan tens of millions of dollars in loans.
That includes 40 per cent of the costs for 23XI and 50 per cent of the $53.2m building 23XI constructed in North Carolina, called “Airspeed.”
Kessler claimed in opening statements that he plans to show evidence the France family personally collected more than $609 million in a recent three-year period and said a 2023 Goldman Sachs study showed NASCAR is worth $7.6 billion.
Before this case even hit the courtroom, NASCAR executives were in hot water in their own paddock.
Unsealed text messages from 2023 were made public from NASCAR president Steve Phelps about Richard Childress, owner of Richard Childress Racing.
Steve Phelps, NASCAR president is under fire for private messages that were unsealed. Getty
Phelps said Childress ‘needs to be taken out back and flogged. He’s a stupid redneck who owes his entire fortune to NASCAR’, in a text conversation with chief media officer Brian Herbst.
Phelps added that ‘Childress is an idiot’ and ‘if they don’t like the sport, sell [your] charter and get out.’
And for good measure, he told Herbst again that ‘did I mention that Childress is an idiot.’
The text messages did not sit well with Childress, the team looking to explore legal options themselves for the ‘defamatory’ text messages from Phelps.
What are the outcomes?
No matter the outcome of this trial, a change is inevitable.
If 23XI and Front Row win, the jury will determine actual monetary damages and Judge Kenneth Bell can adjust the figure and even triple it.
Bell would be charged with unravelling any found monopoly.
This could force the France family to sell the sport, sell the tracks it owns, dismantle the charter system, order permanent charters – anything is possible.
Lisa France Kennedy, part of the France family, will be dragged into the court case. Getty
If NASCAR wins, Jordan and Hamlin will most likely be out of business from 2026 onwards, with the governing body selling all three of 23XI’s charter teams.
There is interest from private equity firms to buy the charters, the last one in the sport’s history being sold at $68.4m AUD.
At the end of this case, either NASCAR loses an entire team, co-owned by arguably the biggest star in the history of sports, or their nearly 80-year-old business structure is thrown in the shredder.
“I think one of us is on a suicide mission,” admitted Hamlin.