AllRacing

23XI, Front Row score a win against NASCAR as lawsuit continues

23XI Racing and Front Row Motorsports were granted a win in federal court on Tuesday when their summary judgment was granted on the definition of premier stock car racing.

The order means Judge Kenneth Bell agreed that NASCAR controls the market for stock car racing, while finding no merit to the argument that teams can race in other series. Additionally, Judge Bell denied NASCAR’s request for summary judgment, which claimed the teams were outside the statute of limitations, had no standing, and could not prove their damage claims.

“We are very pleased with the Court’s decision today, ruling in our favor,” Jeffrey Kessler, the lead counsel for the two teams, said in a statement.

“Not only does it deny NASCAR’s motion for summary judgment, but it also grants our partial summary judgment motion, finding that NASCAR has monopoly power in a properly defined market. This means that the trial will be focused on whether NASCAR has maintained that power through anticompetitive acts and used that power to harm teams. We’re prepared to present our case to the jury and are focused on obtaining a verdict that benefits all of the teams, partners, drivers, and the fans.”

NASCAR also made a statement on Tuesday’s ruling, stating, “NASCAR looks forward to proving that it became the leading motorsport in the United States through hard work, risk-taking, and many significant investments over the past 77 years. The antitrust laws encourage this – and NASCAR has done nothing anticompetitive in building the sport from the ground up since 1948.

“While we respect the Court’s decision, we believe it is legally flawed and we will address it at trial and in the Fourth Circuit if necessary. NASCAR believes in the charter system and will continue to defend it from 23XI and Front Row’s efforts to claim that the charter system itself is anticompetitive.”

Judge Bell made his decision based on two arguments the teams brought forth: the definition of a relevant market, and NASCAR’s monopsony power in that market.

On the topic of the definition of the relevant market, Judge Bell wrote that “not only is it illogical, but there is no record evidence that racing teams in the various motorsports can only move from NASCAR to another motorsport, but not vice-versa. Again, NASCAR wants to (but cannot) have it differently on each side of the same coin – heads we win, tails you lose.”

Judge Bell later noted that NASCAR failed to identify any competitors or potential competitors in or outside the United States. Additionally, Judge Bell stated that “just because there is only one racing league

 currently in the market does not mean that there could not be others. The relevant market is defined by the characteristics of the highest level of stock car racing, not NASCAR’s brand. In other words, the fact that NASCAR has maintained its position as the sole buyer in the market for many years… does not make it a self-defining market.”

On the second point of monopsony power, Judge Bell wrote that “NASCAR effectively has 100% market share. And NASCAR has maintained its total share of the market for decades …”

 

The decision has clarified the focus for the antitrust lawsuit, which begins in December. It will be focused on whether NASCAR unlawfully used its power. 23XI Racing and Front Row Motorsports filed its antitrust lawsuit in October 2024.