Michael Jordan’s 23XI Racing and Front Row Motorsports notched a major win in their antitrust fight with Nascar on Tuesday, tightening the case’s scope and turning up the pressure for a settlement.
US district judge Kenneth Bell granted the teams partial summary judgment on a critical threshold issue, namely the relevant market. He ruled the case will proceed under the definition of “premier stock car racing”, rejecting Nascar’s argument that teams unhappy with its terms could simply pivot to IndyCar or Formula 1. In other words, the open-wheel series aren’t substitutes for Nascar’s Cup Series in the dispute.
Bell leaned on Nascar’s own filings to get there, pointing to the sanctioning body’s counterclaim that framed the market as “the market for entry of cars into Nascar Cup Series races in the USs and any other location where a Cup Series race is held”.
The judge said: “The same transaction – the sale and purchase of premier stock car racing services – cannot be a different relevant market depending only on which side is complaining. Most simply put, Nascar made a strategic decision in asserting its counterclaim and must live with the consequences.”
The ruling also denied Nascar’s bid to toss the case outright. A jury will decide whether Nascar wields monopoly power in the narrower market, and, if so, whether it maintained it through anticompetitive conduct.
“We are very pleased with the court’s decision today, ruling in our favour. Not only does it deny Nascar’s motion for summary judgment, but it also grants our partial summary judgment motion, finding Nascar has monopoly power in a properly defined market,” said Jeffrey Kessler, lead counsel for 23XI and Front Row.
“This means the trial can be focused on whether Nascar has maintained the power through anticompetitive acts and used the power to harm teams.”
The flashpoint is Nascar’s new charter agreement, which was handed to teams at the start of the 2024 playoffs with a firm signing deadline after more than two years of fraught talks. Charters are the backbone of the Cup Series model as they guarantee entry and a predictable slice of revenue each week.
23XI and Front Row said the terms left them no viable choice. The two declined to sign, are competing unchartered this season with sharply reduced prize money and argued without a fair deal their operations could be forced out of business.
The lawsuit is slated for trial on December 1.
Last week Bell also dismissed Nascar’s countersuit against the two teams and Curtis Polk, a 23XI co-owner and longtime adviser to Jordan.
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