Reading between the lines, it doesn’t seem like the federal judge overseeing the 23XI Racing and Front Row Motorsports v NASCAR antitrust lawsuit is preparing to grant the motion to dismiss argued before him on Wednesday afternoon.
Beyond the procedural element of requiring oral arguments for a motion to dismiss, judge Kenneth D. Bell also said upon closing the session in his Charlotte, North Carolina courtroom that he wanted the opportunity to ‘size up’ both sides and allow them to do the same.
Bell took over this case from the originally presiding Frank D. Whitney. This was the first time that lead attorneys Jeffrey Kessler (23XI, Front Row) and Chris Yates (NASCAR, Jim France) have argued in front of him.
No decision was immediately reached with the judge telling those present a ruling would come as quickly and diligently as possible.
“Lawyers like to size up judges and judges like to size up lawyers,” Bell said before retiring to his chamber. “We’ll be spending a lot of quality time together. This was a good chance for us to size each other up.”
Again, reading between the lines, this doesn’t seem like a judge that seemed moved by the arguments from NASCAR and Jim France to dismiss the lawsuits against them. Remember, there are two different lawsuits here — one against the sanctioning body itself for a violation of federal antitrust law and France for overseeing it as an owner and CEO.
Much of what was argued in court was a rehash of what has been issued in filings from both sides over the past month. Present from NASCAR was France and longtime employee Mike Helton alongside several senior officials. Denny Hamlin, who co-owns 23XI with Michael Jordan, was present alongside Front Row general manager Jerry Freeze.
NASCAR wants this case dismissed because it says the two teams have brought forth claims of antitrust violations that are beyond a four-year statute of limitations. Those include the acquisition of the ARCA Racing Series in 2018, the merger with International Speedway Corporation in 2019 and the NextGen single source supplied parts agreement that NASCAR says was conceived in 2018.
That last bit received a lot of push back from the 23XI and Front Row camp as they said the NextGen was not formally introduced until 2021, specifically when teams were forced to buy parts at NASCAR mandated pricing and thus starting the allege anticompetitive damage in advance of its 2022 debut.
The teams argued that anticompetitive damage being suffered by the teams is ongoing and not subject to a statute of limitations. They argued that NASCAR has placed exclusions on tracks every year that prevent another Stock Car racing entity from racing on tracks that have Cup Series dates, specifically citing the language in filings.
They argued that 23XI Racing did not even begin participating in the Cup Series until 2021 and is thus inside the statute of limitations but that even then, every charter transfer requires a renewed commitment to ‘exclusionary acts’ that effectively resets the statute.
The teams say they suffer anticompetitive injury every single time they make a purchase of monopolized products, like NextGen parts, or sell services, like their participating in the charter agreement, at monopsony rates.
Yates says that under the Kessler interpretation of the law, then nothing can fall within of the statute of limitations, an idea he finds absurd.
NASCAR, as it has all along, says that it cannot conceivably be acting in a monopolistic fashion because it has increased the value of participating teams while also increasing the payout for charters from the inaugural 2016 document to its 2025 successor.
It argues that it makes no sense for 23XI and Front Row to claim that NASCAR is a monopoly and anticompetitive while continuing to purchase charters and further participate in the Cup Series. NASCAR, through Yates, argued that 23XI was ‘eyes wide open’ when choosing to invest into NASCAR and did so knowing exactly what the dynamic was — making it intellectually dishonest to then claim after the fact that it is anticompetitive.
NASCAR maintains that 23XI and Front Row have merely reacted to contract terms that didn’t go their way after two years of negotiations rather than having an altruistic anticompetitive claim to bring against the sanctioning body.
Kessler, arguing on behalf of 23XI and Front Row, countered that they disagree, but even then, this is not a merit to dismiss but rather something that must be determined over the next year in court.
There was one humorous exchange between Kessler and judge Bell at this point of the hearing:
“They started with their worst argument …”
“What is their best argument, Mr. Kessler.”
(scratches his head) “Hmm.”
“I’m sure Mr. Yates will give me one.”
Yates said that Michael Jordan, after selling his NBA basketball team could have chosen to invest his money in Formula 1 or IndyCar, reflective of competition in the motorsports marketplace.
Kessler responded that there is nowhere else, other than NASCAR, for 23XI and Front Row to pursue becoming a top Stock Car racing team.
Kessler made a humorous analogy:
“If you’re an apple monopoly, you can’t legally argue ‘go eat pears’ as a substitute for the apple market.” 23XI and Front Row aren’t in the IndyCar or Formula 1 markets.
Motion to post bond
The two sides also argued over NASCAR’s request to the court that 23XI Racing and Front Row Motorsports should post money into an escrow bond to cover the amount it will pay the teams if they are ultimately recognized as having de facto charters in 2025.
Judge Bell ruled last month that NASCAR has to recognize both teams as having charters this coming season while also forcing the sanctioning body to approve the purchase of a charter by each team from what was Stewart-Haas Racing.
NASCAR believes this money is necessary because if it ultimately defeats the teams in court, it will argue that 23XI and Front Row should have never been entitled to charter money and will want it back.
For the first time, exact figures were detailed publicly.
NASCAR has said that being forced to give charter money to six combined 23XI and Front Row teams will come at the expense of a plan to increase payouts for the teams that signed the charter agreement; plus open team increases this season.
Specifically, NASCAR said $9 million was going to the teams prior to the injunction order and there was $20 million ‘forthcoming,’ whatever that means. The judge wanted to know more too but Yates didn’t have a clear answer.
But NASCAR did say there was a provision in the charter agreement that if there were less than 36 charters, there would be an increase in payout to whatever number of teams remained. The teams and their lawyers rejected that notion, saying that the only thing required is a nominal increase and that NASCAR would pocket the rest of that money under the guise of ‘investing into marketing the sport,’ which is how the sanctioning body put it into a filing earlier in the week.
Judge Bell even asked NASCAR ‘is there not value in having these teams participate in every Cup Series race,’ even recognizing that they disagreed with the injunction ruling.
This was a response to the claim that NASCAR will suffer harm in recognizing 23XI and FRM has chartered.
NASCAR through Yates said ‘no,’ because the sanctioning body would receive many of those same benefits if 23XI and Front Row participated as open teams, like they were committed to doing this year before the injunction was granted.
The judge responded that there was no guarantee that 23XI and Front Row would qualify for every race if there were more open teams than spots available.
NASCAR said, ultimately, they would have been perfectly fine if the charter system had never been created in the first place. NASCAR says the model in the Xfinity and Craftsman Truck Series was perfectly functional to them and that the charter system was an ask from the teams.
That, instead of competing for money through race and championship purses, that the teams wanted the guaranteed value and starting spots. Yates and NASCAR characterized the teams, all of them, as a ‘cartel.’
Yates and NASCAR said the teams, through the Race Team Alliance, strong-armed NASCAR by banding together and dictating terms of the charter agreement. He went as far as suggesting that the only anticompetitive behavior that existed came from the teams.
“If there was any anticompetitive behavior, it came from the RTA,” Yates said. “They acted as a cartel. They said ‘we will only do this if you give us these terms.’ That’s unlawful.”
The judge then pushed back by asking ‘didn’t NASCAR do the same thing in August with a take it or leave it final offer?’
Yates said that was different because NASCAR, after two years of negotiations, has simply reached the end of that process and that it was time to prepare for the 2025 season. He said NASCAR was prepared to share 47 percent of TV revenue with the teams but that they once again ‘acted as a cartel.’
Representing the teams, attorney Jeanifer Parsigian said she disagreed with pretty much everything Yates said.
“I’m shocked,” Judge Bell quipped.
Parsigian said the charter agreement allows for NASCAR to have up to 43 chartered teams and that the sanctioning body will suffer no harm in paying 23XI and Front Row to mutually participate in the terms of the charter agreement.
She said that NASCAR isn’t just giving the teams money. Parsigian argued that it’s a mutual agreement that both parties have to adhere to and that this week alone Netflix reached out to 23XI to participate in season two of the Full Speed documentary.
Parsigian said that 23XI would be under no responsibility to take time to participate in a production NASCAR is part of if they weren’t a chartered team. They would not have to participate in two exhibition races. She said the teams would not have to invest time and resources into NASCAR initiatives but they are and that is why they are entitled to a) receive the 2025 charter money and b) not have to put any money into an escrow bond and give it back should they lose.
Their perspective is that they are both going to adhere to the terms of the injunction order in 2025.
NASCAR’s response was that the charter provision also includes a goodwill provision that participating teams agree to not say derogatory things in public, which Kessler did to the media when announcing the lawsuit.
Kessler called NASCAR an abusive spouse.
Bell challenged Parsigian on that front, saying he understood why NASCAR would not want to be in business with teams that essentially bad mouthed them in public.
“That’s your opinion, your hornor.”
“I would say it’s a little more than an opinion.”
“Of course, I apologize, your honor.”
Parsigian ultimately said the actions were that of a privileged client-attorney relationship and that they were detailing the merits of their case to the public.
How did it go?
“Good. We’re happy to have our day in court as always,” Kessler said. “We look to moving forward with the case. Very happy to hear the judge say that the trial date is going to happen no matter what, not going to move, and that’s exactly what we want.”
Does Kessler feel like the case will move forward?
“I am very hopeful that he will not but I do not believe it likely that this case will be dismissed,” the attorney continued.
As for how the judge chided Parsigian about their comments to the media?
“No, no, I respect 100 percent what the judge says and we’ll always take that into account and proceed accordingly,” he said.
What next?
The judge is going to try to expedite a ruling on both of these matters — both the motion to dismiss from NASCAR and James France but also the matter of the escrow bond.
The judge says he will be flexible with the established trial timeline but he is not going to be flexible on the December 1 trial date, nor will he accept being ‘pinched’ in terms of discovery disputes. Bell said he ‘hates’ mediating discovery but has opted to do it with this case, instead of delegating to a magistrate judge, in order to preserve the below timeline.
- Wednesday January 8, 2025 | Hearing on motion to dismiss
- Friday January 10, 2025 | Rule 26 Disclosures
- Friday January 31, 2025 | Designation of Mediator
- Saturday March 15, 2025 | Amendment of the Pleadings
- Monday June 30, 2025 | Close of Fact Discovery
- Friday September 19, 2025 | Completion of Discover
- Wednesday September 24, 2025 | Mediation Report
- Wednesday October 1, 2025 | Filing of Dispositive Motions
- Monday December 1, 2025 | Trial
Lawsuit timeline
23XI Racing, Front Row decline to sign NASCAR’s final 2025-2031 charter document
Why 23XI, Front Row filed a lawsuit against NASCAR
23XI, Front Row makes his case in antitrust lawsuit against NASCAR
Richard Childress says he had ‘no choice’ but to sign charter document
How drivers feel about the lawsuit
Michael Jordan comments on his team’s lawsuit against NASCAR
Meet NASCAR’s antitrust defense lawyer
NASCAR files injunction to be included in charter system through lawsuit
NASCAR motions against team’s preliminary injunction request
NASCAR, teams consent to redacting charter details in filings
Teams make case for injunctive relief, expedited discovery
NASCAR’s lengthy rebuttal to injunction, lawsuit
Teams respond to NASCAR response over injunction
23XI, Front Row and NASCAR go to court over injunctions
Judge rules against teams preliminary injunction request
Denny Hamlin says 23XI may not race next year
What preliminary injunction denial means for lawsuit
NASCAR drops ‘lawsuit release clause’ in open agreement
Appeal timeline rebuttal filed by NASCAR
Why 23XI may not have to race in the Clash without charters
Teams drop appeal, may re-file in district court
23XI, Front Row re-file injunction request
NASCAR opposes expedited timeline
France, NASCAR motion to dismiss, deny SHR charter transfer request
NASCAR says injunctive request still fails to show irreparable harm
Teams say NASCAR went back on its word over SHR charters
23XI, Front Row respond to NASCAR’s motion to dismiss
Judge orders NASCAR to issue charters to 23XI, Front Row
NASCAR plans to appeal injunction ruling; other details
Judge grants partial stay of injunction in blunt response to NASCAR
Teams accuse NASCAR of petulance in response to delay request
Why Judge Bell did not delay his injunction order
NASCAR wants 23XI, FRM to post bond covering 2025 charter pay
Both sides meet in court to argue motion to dismiss, bond payment
Matt Weaver is a Motorsports Insider for Sportsnaut. Follow him on Twitter.
