The NASCAR charter lawsuit settlement, reached on December 11, 2025 after eight days of trial in federal court in North Carolina, ended a fourteen-month antitrust fight between NASCAR and two of its Cup Series teams — 23XI Racing and Front Row Motorsports — and rewrote the economics of stock-car racing for every chartered team in the garage. The financial terms are confidential, but the structural terms are not: all fifteen chartered teams received permanent “evergreen” charters, a share of international media and team intellectual-property revenue, a five-strike mechanism to check unilateral NASCAR cost increases, and a two-thirds team-approval requirement for future charter agreements that resembles collective bargaining in stick-and-ball leagues.1
What the Teams Were Fighting Over
The charter system dates to 2016 and was NASCAR’s answer to team demands for guaranteed race entries and a share of television money. It came under pressure when NASCAR negotiated a new seven-year television deal reported at $7.7 billion covering 2025 through 2031. Teams wanted a bigger cut, permanent charter status, and a voice in governance. NASCAR, led by Chairman Jim France, resisted.
On September 6, 2024, NASCAR handed team owners a 112-page charter agreement and set a midnight deadline to sign. Front Row owner Bob Jenkins later testified that attorneys could not review the document on that timeline; when he asked for an extension, Commissioner Steve Phelps told him negotiations were finished. Thirteen of the fifteen chartered teams signed. The two that refused were 23XI Racing, co-owned by Michael Jordan, Denny Hamlin, and Curtis Polk, and Jenkins’s Front Row Motorsports.
On October 2, 2024, the two teams filed suit in the U.S. District Court for the Western District of North Carolina, 2311 Racing LLC v. National Association for Stock Car Auto Racing, LLC, Case No. 3:24-cv-00886, assigned to Judge Kenneth D. Bell. Lead counsel was antitrust litigator Jeffrey Kessler. The complaint alleged that NASCAR maintained monopoly power over premier stock-car racing through several overlapping mechanisms:
- Track control: after acquiring International Speedway Corporation in 2018, NASCAR controlled twelve major tracks and used exclusivity agreements to keep them from hosting rival series.
- Elimination of competitors: NASCAR’s 2020 acquisition of the Automobile Racing Club of America converted a potential rival into a feeder series.
- Noncompete clauses: the 2025 charter expanded prior restrictions to bar teams from competing in any automobile or truck series not sanctioned by NASCAR.
- Next Gen car mandates: teams had to use NASCAR’s Next Gen car and source parts exclusively from approved vendors at roughly $3 million per car per year, with NASCAR retaining ownership of the parts.
- Revenue imbalance: the teams alleged they received about 25 percent of television revenue and roughly 13 percent of total sport revenue while bearing the full cost of competition, estimated at about $18 million per car annually.
The plaintiffs argued the Cup Series was a distinct market with no viable substitute; Formula 1 and IndyCar were not equivalent alternatives for a stock-car team. They sought damages, permanent charters, a larger revenue share, and a governance role.
How the Case Moved Through Court
Because 23XI and Front Row had refused to sign, they risked losing charter status and the revenue and race entries that came with it. That produced a running fight over whether they could race as chartered teams while litigation proceeded.
- November 8, 2024: Judge Frank Whitney denied the teams’ initial injunction request as premature.
- December 18, 2024: Judge Bell granted a preliminary injunction letting both teams race with charters during 2025, finding NASCAR held “monopoly power in stock car racing” and that losing drivers would cause irreparable harm.
- January 10, 2025: Bell denied NASCAR’s motion to dismiss, saying the case “deserves to be tried this year,” and denied NASCAR’s request for a bond exceeding $10 million per car.
- June 5, 2025: The Fourth Circuit reversed Bell’s injunction. Judge Niemeyer’s opinion held that requiring a release of past claims as a condition of doing business was not, by itself, anticompetitive conduct under the Sherman Act. The panel expressly took no position on the merits of the underlying antitrust claims.
- July 17, 2025: The teams were denied a temporary restraining order and had to compete as unchartered “open” entries with sharply reduced prize money.
NASCAR filed a countersuit in March 2025 alleging that 23XI, Front Row, and Curtis Polk had organized an “illegal cartel” that forced joint negotiations and inflated charter payouts. Judge Bell dismissed the countersuit on summary judgment in late October 2025. He found NASCAR failed to establish antitrust injury, noting that its own expert economist acknowledged there was “no evidence that the Teams’ collective actions caused NASCAR to increase its Charter payments,” and pointing out that thirteen teams had individually signed the 2025 deal, which showed NASCAR could negotiate one-on-one. Bell also observed that, given NASCAR’s “significant power over any single race team,” joint negotiations could enhance competition rather than restrain it.
What the Trial Revealed
Trial opened on December 1, 2025, with Denny Hamlin as the first witness. Kessler built much of the plaintiffs’ case around NASCAR’s own internal communications.
Text messages between Commissioner Steve Phelps and President Steve O’Donnell from 2022 and 2023 showed an aggressive internal posture. When Hamlin participated in the rival Superstar Racing Experience, O’Donnell texted Phelps: “Enough. We need legal to take a shot at this.” Phelps called SRX a “trash series” and wrote that NASCAR needed to “put a knife” in it. O’Donnell described the organization’s approach as “smiles all around but behind the scenes we scheme and we win.” A Phelps email about the charter deadline read: “Pick a date and they can sign or lose their charters. It is that simple.”
Kessler also used internal messages to show frustration inside NASCAR. O’Donnell described the charter proposal as potentially reverting the sport to a “dictatorship, redneck, Southern tiny sport.” Phelps called one draft one with “zero wins for the teams.” Executive Vice President Scott Prime, who testified over two days, described the refusal to make concessions as “a bold strategy.”
Bob Jenkins testified he had never turned a profit in more than twenty years of running Front Row, estimating losses of $100 million despite winning the 2021 Daytona 500. Michael Jordan spent about an hour on the stand, saying he was “not afraid” to challenge NASCAR and that permanent charters were among the “four pillars” the teams needed. Hamlin called the proposed agreement a “death certificate for the future” of 23XI and acknowledged that his past public praise of the charter system had been motivated by a desire to avoid a “tongue-lashing” and potential retaliation.
Jim France testified that he was “just not comfortable making agreements that go on forever.” NASCAR’s counsel tried to undermine the plaintiffs’ credibility, noting that Hamlin had built a $35 million race facility NASCAR never required and that 23XI paid its drivers a smaller revenue share than NASCAR paid the teams. A plaintiffs’ economist estimated damages at $1.06 billion; defense counsel Lawrence Buterman called the figure “imaginary.”
Kessler’s cross-examination of France on the eighth day proved especially damaging. He forced France to admit involvement in the original 2016 charter negotiations after France had initially said he had “nothing to do” with them. Kessler also surfaced the existence of “Gold Codes,” described as a NASCAR contingency plan for vertical integration — a roadmap for replacing teams that refused to sign.
Terms of the Settlement
On the morning of December 11, 2025, before the ninth day of proceedings, the parties submitted settlement terms to Judge Bell. The dollar figures are confidential. For context, the plaintiffs had asked the jury for $365 million in damages, and the six charters returned to 23XI and Front Row were estimated to be worth as much as $300 million collectively based on recent sale prices of roughly $45 million per charter.
The structural terms apply to all fifteen chartered teams:
- Permanent “evergreen” charters. NASCAR can no longer cancel the charter system at the end of an agreement period. Teams received new charter agreements in January 2026 with fourteen days to sign or keep their existing terms, with no risk of losing their charters either way.
- A share of international media rights and revenue from team intellectual property, and a greater voice in league governance.
- A five-strike rule running for the remaining six years of the deal. Any NASCAR change costing at least $500,000 per car imposed without team approval counts as a strike; five strikes nullify the charter agreement’s exclusivity clause.
- NASCAR’s cut of charter sale proceeds rises from two percent to ten percent.
- Future charter agreements require approval by two-thirds of the teams, a framework that resembles collective bargaining in professional team sports.
- Teams are capped at three charters, with grandfathered exceptions for Joe Gibbs Racing and Hendrick Motorsports, which each retained four.
Both sides acknowledged Judge Bell and mediator Jeffrey Mishkin. Bob Jenkins said the settlement produced a system that “treated our teams, drivers and sponsors fairly and kept the competition strong.” NASCAR framed the resolution as allowing the parties to move on to future seasons.
What It Changes for the Cup Series
Before the settlement, charters were term-limited contracts a team could lose if NASCAR chose not to renew the system. After it, charters function closer to franchise rights: they cannot be unilaterally revoked, they carry a share of a broader set of revenue streams, and their price at sale is subject to a larger NASCAR commission. The two-thirds approval requirement means NASCAR cannot again impose a take-it-or-leave-it agreement on a midnight deadline; a supermajority of teams has to agree, or the deal does not happen. The five-strike rule places a running cost on unilateral technical mandates that had previously been NASCAR’s to make alone.
The case also produced a public record of how NASCAR conducted its business with teams and rivals: the messages about SRX, the “smiles all around but behind the scenes we scheme” text, the “Gold Codes” contingency plan, and France’s admissions on cross about the 2016 negotiations. Those disclosures did not appear in the settlement terms, but they were the pressure that produced them.