MJ-led suit: NASCAR, France family are ‘bullies’
CHARLOTTE, N.C. — Two NASCAR teams — one of them co-owned by Michael Jordan — filed a federal antitrust lawsuit against the stock car series and chairman Jim France on Wednesday, claiming the new charter system limits competition by unfairly binding teams to the series, its tracks and its suppliers.
23XI Racing and Front Row Motorsports filed suit in the Western District of North Carolina in Charlotte after two years of contentious negotiations between the privately owned National Association for Stock Car Auto Racing and the 15 charter-holding organizations in the Cup Series, the organization’s top series.
“The France family and NASCAR are monopolistic bullies,” the teams said in the lawsuit, a copy of which was obtained by The Associated Press. “And bullies will continue to impose their will to hurt others until their targets stand up and refuse to be victims. That moment has now arrived.”
NASCAR in early September presented its final offer on what is essentially a revenue-sharing model; 13 organizations signed, with most saying they did so under duress or felt threatened into doing so.
But 23XI Racing, the team co-owned by Jordan and veteran driver Denny Hamlin, and the smaller Front Row team refused to sign. They hired Jeffrey Kessler, a top antitrust attorney who has represented the players in all four major professional North American sports, helped push the NCAA toward an era of paid college athletes, and won a landmark equal pay settlement for members of the U.S. women’s national soccer team.
The lawsuit seeks details from NASCAR and France “related to their exclusionary practices and intent to insulate themselves from any competition.” Kessler said he would ask for a preliminary injunction that will enable the two teams to compete in 2025 under the new charter agreement while the litigation proceeds.
The teams said they will seek treble damages for anticompetitive terms that have ruled the sport since the initial 2016 charter agreement.
“Everyone knows that I have always been a fierce competitor, and that will to win is what drives me and the entire 23XI team each and every week out on the track,” said Jordan, the retired NBA superstar. “I love the sport of racing and the passion of our fans, but the way NASCAR is run today is unfair to teams, drivers, sponsors and fans. Today’s action shows I’m willing to fight for a competitive market where everyone wins.”
NASCAR, based in Daytona Beach, Florida, had no immediate comment.
What is a charter? The charter system introduced in 2016 included revenue sharing and other elements of the business for the top motorsports series in the United States while guaranteeing 36 entries in every lucrative Cup Series race. Of the 19 team owners who were originally granted charters in 2016, the lawsuit says, only eight remain in the sport.
One of the departing teams was Furniture Row Motorsports, which sold its charter for $6 million at the end of the 2018 season — a year removed from winning the Cup Series championship — proof, the plaintiffs say, that the charters left the teams without a path to profitability.
The original charters lasted from 2016 through 2020 and were automatically renewed to continue through Dec. 31, 2024. With expiration looming, teams argued that the revenue sharing is unfair and demanded a larger share of the pot.
Front Row owner Bob Jenkins has maintained that he has never turned a profit since forming his team in 2005. He won the Daytona 500 in 2021 with driver Michael McDowell yet failed to break even in that banner season.
With four sons and a desire to leave something for his family to run, Jenkins said he wants a fair agreement.
“I have been part of this racing community for 20 years and couldn’t be more proud of the Front Row Motorsports team and our success. But the time has come for change,” Jenkins said. “We need a more competitive and fair system where teams, drivers, and sponsors can be rewarded for our collective investment by building long-term enterprise value, just like every other successful professional sports league.”
What do the teams want? During negotiations, the teams asked for more revenue, a voice in governance and rulemaking, and a cut from deals NASCAR earns off the names, images and likenesses of the participants.
The teams also wanted the charters to be permanent; France has refused.
According to the suit, NASCAR presented a take-it-or-leave-it offer on Friday, Sept. 6, 48 hours before the playoffs began. It says NASCAR threatened teams to sign the more than 100-page agreement or risk losing not only their charters but the charter system itself unless “a substantial number of teams” agreed.
“The teams knew that fielding a NASCAR car had become so expensive that it would be economically devastating for most of them to compete without even the modest revenue sharing and stability provided by the charter system and the complete loss of their charter values if the charter system was discontinued,” the lawsuit claims.
Rick Hendrick, the winningest owner in NASCAR history, has said he signed only because he was worn down by the negotiations. 23XI Racing and Front Row held out, but their motivation remained unclear until Wednesday’s court filing.
What does the lawsuit claim? The suit argues that NASCAR violated the Sherman Antitrust Act by preventing any stock car racing team from competing on the circuit “without accepting the anticompetitive terms” it imposes.
“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 states. “One team described its signing as ‘coerced,’ and another said it was ‘under duress.’
“A third team said, NASCAR ‘put a gun to our heads’ and we ‘had to sign.’ A fourth described NASCAR’s tactics as that of a ‘communist regime.’ None of these teams would permit their identities to be publicly revealed for fear of retribution from NASCAR.”
How did it get here? NASCAR was founded in 1948 by Bill France Sr. and run by him until 1972. Since then, it has been run first by his son Bill France Jr., then by Bill Jr.’s son, Brian France, and now by Bill Sr.’s second son, Jim France. Ben Kennedy, the son of Bill Jr.’s daughter, Lesa, is the heir apparent to the family business.
The lawsuit maintains that NASCAR until 2016 operated under year-to-year contracts that provided no long-term viability to any team. There was no guaranteed entry into any Cup Series event or prize money, and teams depended on individual sponsorships they had to find themselves.
That model made sustainability next to impossible for any owner who tried to operate exclusively as a racing team without additional outside businesses. Chasing sponsorship became a full-time job, and teams often found themselves competing with NASCAR outright for financial deals.
The teams felt they were operating in a “constant state of financial vulnerability” that put some of the most successful organizations out of business, the lawsuit states. It quotes NASCAR Hall of Famer Jimmie Johnson, who has mostly retired as a driver and is the co-owner of a fledgling Cup Series team.
“In the words of NASCAR Hall of Famer Jimmie Johnson,” the lawsuit says, “the best thing to be is NASCAR, the second best a driver and the last thing a team owner.”
Seven-time NASCAR champion Jimmie Johnson is now the majority owner of Legacy Motor Club under a restructuring in which investment adviser Knighthead Capital Management bought into the Cup Series team.
Knighthead manages $9 billion of assets with a portfolio that includes investments in Hertz, World Endurance Championship sports car team JOTA Racing, Singer Vehicle Design, Revology Cars and a controlling stake of English soccer team Birmingham.
Johnson told The Associated Press that the deal announced Monday makes Knighthead “a significant minority partner” in that the private equity firm bought much of the ownership stake held by Legacy co-owner Maury Gallagher.
Gallagher retained some shares in the NASCAR team but will step down from day-to-day operations and join Hall of Famer Richard Petty as an ambassador for Legacy.
Johnson, who has been living in England for more than a year, will return to Charlotte to be hands-on in his larger role with Legacy. His wife and two daughters will follow at the end of the school year.
“I thought I was going to have three more years to understand ownership more,” Johnson told the AP of his original plan when he bought into the NASCAR team ahead of the 2023 season.
Legacy is essentially the rebuild of Petty Enterprises, one of NASCAR’s oldest and winningest race teams. Gallagher, the chairman of Allegiant Air, owned GMS Racing and, in 2021, acquired Richard Petty Motorsports, rebranding it as Petty GMS Racing.
Johnson signed on at the end of 2022, and the team was again rebranded into Legacy as it expanded to two full-time Cup cars ahead of the 2023 season. The plan was to allow Johnson to grow into his role as NASCAR team owner over five seasons, but the timeline changed when he developed a relationship with Knighthead and Gallagher decided to step back.
“I’ve had an open eye to the private equity world and trying to understand what’s out there,” Johnson said. “I know that there are some other teams with PE involvement, and I just started to get to know people. I had a head start and a few friendships out there, but ultimately the opportunity and access to Knighthead and the friendship I built was done socially, and when it was time to really engage in the PE world, we just clicked and got together to see where we could go.
“We wanted to move quick. And here we are, it’s only been a couple of months, it’s been very, very quick.”
The partnership begins immediately, and Knighthead will be part of Legacy when the NASCAR season begins this weekend with the preseason race at Bowman Gray Stadium in Winston-Salem.
Tom Wagner, co-founder and co-managing member of Knighthead Capital, said the firm was drawn by “NASCAR’s rich history and Legacy MC’s ambition and innovation make it a unique opportunity.”
“We’re thrilled to collaborate … to drive the team forward, both on the track and within the wider racing community,” Wagner added.
Tom Brady has stakes in Knighthead but the deal with Legacy does not involve him at this time, Johnson said. But Johnson and Brady have discussed possibly partnering on an Indianapolis 500 entry for driver Sebastian Bourdais with Chip Ganassi Racing. Ganassi told the AP he had only one preliminary conversation with Johnson about it and there has been no further discussion.
Legacy this season will field two full-time cars: the No. 43 Toyota for Erik Jones and the No. 42 Toyota for John Hunter Nemechek. Johnson will attempt to qualify next month for the season-opening Daytona 500 and also the Coca-Cola 600 in May.
Johnson, who turns 50 in September, ran nine races last year but said he realized at the season-finale in Phoenix that Legacy needs him more in his executive role than as a driver.
He thanked Gallagher for the opportunity to become a NASCAR team owner and is eager to help Legacy improve its on-track performance while working with Knighthead to expand the brand.
“He has been an outstanding partner, mentor and friend, and I’m grateful we had the opportunity to work together,” Johnson said of Gallagher. “I’ve learned so much from him, and as his professional career takes a different path, he can worry less about being an owner and more about focusing on family and enjoying life.”
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Jesse Rogers
CHICAGO — The Cubs are finalizing a trade to acquire closer Ryan Pressly from the Houston Astros, pending medical review, sources told ESPN’s Jeff Passan on Sunday.
Pressly will waive his no-trade clause to facilitate the move, and Houston will send money to help cover his $14 million salary, the sources said.
The Astros will receive a low-level Cubs prospect who is not on Chicago’s 40-man roster, according to a source.
Pressly, 36, is likely to become the Cubs’ closer, a role he held with Houston from 2021 to 2023 before it signed Josh Hader to a long-term contract. The veteran righty has 112 saves with a 3.27 ERA during his 12-year career, which includes six seasons in Minnesota.
Pressly will join a bullpen that blew 26 saves last season, as the Cubs are looking to make a playoff push in 2025. Chicago hasn’t been to the postseason since 2020, working without an established closer over the past few years.
Righty Adbert Alzolay was ineffective last season, then he suffered a forearm injury and eventually needed Tommy John surgery. Porter Hodge, 23, finished the season as the closer, but the team wanted more experience and depth in the back end of the bullpen.
The Cubs pursued lefty Tanner Scott before he signed with the Los Angeles Dodgers last weekend, according to league sources. Chicago was less interested in the other free agent closers, instead settling for Pressly, who has one year left on a three-year, $42 million contract signed before the 2023 season.
Pressly will join newcomers Eli Morgan, Cody Poteet, Matt Festa, Caleb Thielbar and Rob Zastryzny in the Cubs’ bullpen.
The trade likely will conclude the bulk of the team’s winter moves.
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