This is an important week in the 23XI Racing and Front Row Motorsports vs NASCAR lawsuit and countersuit.
It could also be the final off-ramp, one final chance to reach a settlement, before preparation begins in full for a trial by jury in a Charlotte, North Carolina courtroom on December 1. To be sure, a settlement could be reached at anytime before then, but a decision from the judge (Kenneth D. Bell) overseeing this case will force the two parties to engage in good faith mediation with him present.
This was the byproduct of a motion filed by NASCAR to the court on October 6, which asked Bell to force both parties to mediate with him present, a motion that 23XI and Front Row pushed back on because they wanted to continue using the mediator both sides agreed upon over the summer.
That process resulted in a single mediation session, in New York on August 5, an event both sides have said produced no positive momentum towards reaching a pre-trial resolution. The judge granted NASCAR’s motion but also required both parties to use the pre-existing mediator Jeffrey Mishkin.
It has been nearly 13 months since the two teams sued the Sanctioning Body on October 2, 2024 alleging violations of federal antitrust law. In short, 23XI and FRM are accusing NASCAR of using its market status to dictate unfair competitive financial terms on the teams.
This came after every team that competes in the Cup Series negotiated with NASCAR for over two years over an extension of the charter document that regulates competition and financials at the highest level of North American motorsports.
In September of last year, NASCAR issued a final take it or leave it style offer, and 13 of the 15 teams that compete in the Cup Series signed. The two that didn’t, 23XI and Front Row, brought forth a lawsuit.
There have been so many twists and turns over the past year but the two teams have pointed towards NASCAR formally acquiring ARCA and International Speedway Corporation, in addition to a lawsuit release clause in the charter agreement, as proof of anticompetitive behavior.
NASCAR countersued the two teams, alleging that they were the ones acting in violation of federal antitrust laws, in terms of how 23XI investor Curtis Polk spearheaded a joint negotiation approach through the Teams Negotiating Committee.
The Sanctioning Body also alleged a conspiracy for every team to boycott the 2024 Daytona 500 qualifying races in an effort to undermine NASCAR broadcast rights agreement negotiations.
Again, this is just the tip of the iceberg and a timeline can be consumed here, but recent activity has even centered around who has true market authority in NASCAR – the Sanctioning Body as purchasers of teams or the teams competing for a sanctioning body.
These are all efforts to either eventually prove or stave off antitrust allegations.
NASCAR insists this is merely a contract dispute, and the two teams are wrongfully claiming antitrust violations as a result of not getting the contractual terms in wanted. The teams are attempting to prove that teams were never going to get their worth from NASCAR because the Sanctioning Body was acting anticompetitively.
The two sides were forced to undergo fact discovery over the summer, the opening of key documents and communications, of which many have been made public. Both sides have even attempted or successfully gained documents from other sports and motorsport disciplines to prove their points.
This will all come to a head on Tuesday as both sides are forced to negotiate in good faith in ways they made not have in August. Judge Bell has made it clear all year that he will not tolerate anything less in his presence.
It may be the last off-ramp the two sides have to find compromise before the autumn months become a full preparation for December 1.
If a settlement is not immediately reached on Tuesday or Wednesday, there is a hearing scheduled for Thursday in which both sides have asked Judge Bell to issue a summary judgement against the other.
This is effectively a motion for the judge to rule on the merits of the case, a chance to throw out parts or all of a suit made by the other. NASCAR wants the teams’ argument to be dismissed on a variety of fronts including a statute of limitations while 23XI and Front Row allege the Sanctioning Body is in obvious violation through the aforementioned reasons plus sidebar arguments like the NextGen car’s allowed usage or contingency plans NASCAR made to race without teams if none of them signed the charter agreement extension.
For what it’s worth, Judge Bell has also indicated to both parties that he is unlikely to issue a summary judgement for either party as to not taint the jury pool in December. But he must listen to both sides on Thursday just in case there is some evidence that warrants such a decision.
But if the week ends without a settlement, and based on what comes out of the hearing on Thursday, it could be full-speed ahead to a trial by jury in December that could forever change the complexion of the NASCAR Cup Series and motorsports in America.
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