NASCAR teams 23XI, Front Row could lose charters next week: What it means

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NASCAR teams 23XI Racing and Front Row Motorsports, whose lawsuit last October against NASCAR and CEO Jim France alleging “monopolistic practices” has been the sport’s biggest subplot of the past year, appear poised to enter uncharted — and unchartered — territory.

Though it’s not time for the organizations to panic yet, there are some ripple effects from a decision by the U.S. Court of Appeals’ Fourth Circuit that could turn into tidal waves.

Front Row and 23XI have been racing as chartered teams — which comes with guaranteed entry into Cup Series races and financial incentives — since filing the lawsuit after refusing to sign a new charter deal NASCAR presented last season. The Fourth Circuit on Wednesday denied the team’s request for an “en banc” — or full-court — rehearing of a smaller three-judge panel’s decision last month to overturn a district court’s decision and wipe away a preliminary injunction that had allowed the teams to do just that. With Wednesday’s ruling came the potential loss of the teams’ status as charter (or franchise) NASCAR organizations.

Barring further developments, the two teams could now lose their combined six charters (they have three cars each) next week before the NASCAR race at Dover Motor Speedway in Delaware.

What does that mean? First of all, a significant financial setback. Charter teams receive millions more per year in race winnings than the non-charter (“open”) teams, and the organizations may now have to repay all the money they have earned with their charters so far this season.

Second, they have to qualify for each race instead of having guaranteed entries. That’s no big deal, though, as long as more than a full field does not show up (only two of 19 races have had fields that exceeded the limit this season).

Michael Jordan’s 23XI Racing owns three NASCAR charters, as does Front Row Motorsports. All six could be gone by the time the cars get to Dover next week. (Logan Riely / Getty Images)

Third — and this could perhaps be the biggest one — 23XI driver Tyler Reddick, a Championship 4 participant last year who is currently fifth in the point standings, could become the hottest free agent in years.

As revealed last December during the teams’ request for a preliminary injunction that would allow them to race as charter teams for 2025, Reddick’s contract has a clause that states 23XI must provide him with a chartered car, or he can sign with someone else.

Would Reddick leave midseason? Would another team swoop in and make him an offer at this point? You can scoff at the possibility, but NASCAR racing is big business. Reddick could potentially fall into the lap of a team looking to make a move and snag a top-10 talent for its future.

What’s to prevent a team from moving on from an underperforming driver on the hot seat, like a Justin Haley at Spire Motorsports (31st in points with only one top-10 finish this season), and making a play for Reddick?

Whether you think it sounds unrealistic or not, these are now the stakes for the unchartered teams — and a major reason why the teams’ attorney, Jeffrey Kessler, argued so hard for a preliminary injunction in the first place. He wanted to show irreparable harm in case the lack of an injunction cost the team one of its drivers or sponsors, and that’s closer than ever to reality.

While Kessler and his clients still have their eye firmly on the Dec. 1 trial date, in which the district court will hear their claim of NASCAR being an illegal monopoly, these smaller motions could suddenly have a major impact.

“We are disappointed by the Fourth Circuit Court of Appeals decision to deny our request for a full rehearing,” Kessler said in a statement. “This decision has no bearing on the strength of our antitrust case, which we look forward to presenting at trial. We are committed to racing this season as we continue to fight for more competitive and fair terms for all teams to ensure the future of the sport, and remain fully confident in our case.”

Kessler is confident the lost charters will ultimately be returned to the teams as part of the outcome at trial or as part of a settlement. NASCAR won’t be selling the charters in the meantime (in case they lose and have to give them back), so no one would have them for the rest of this season.

At Dover, theoretically, there could be 30 chartered cars along with 10 “open” slots (instead of the normal 36 charters and four open). As of Wednesday afternoon, that had not yet been officially determined.

But even if the charters are returned eventually at trial, it wouldn’t undo the potential damage caused by losing them now. What if Reddick does leave? What if one of the team’s cars does miss a race? NBA legend Michael Jordan, 23XI co-owner, has a deep bankroll to keep the team afloat despite the financial hit, but could there be long-term implications with departing employees?

Those are the types of things that could happen now. And maybe they won’t. But the possibility has to be unsettling for teams with still half a season to race until the trial begins.

(Top photo of 23XI Racing driver Tyler Reddick and owner Michael Jordan: Sean Gardner / Getty Images)

This news was originally published on this post .

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