After more than a year of legal conflict and a high-stakes federal trial that could have reshaped the business of stock car racing, NASCAR has settled with two of its own Cup Series teams, including 23XI Racing, co-owned by NBA legend Michael Jordan.
The announcement came on Thursday on the ninth day of the trial in federal court in Charlotte, N.C., ending what many in the sport had expected to be a protracted legal battle.
The lawsuit, filed in October 2024 by 23XI Racing and Front Row Motorsports, accused NASCAR of monopolistic and anti-competitive behavior centered on its charter system, the model that guarantees teams a spot in every Cup Series race and a set share of revenue.
Under NASCAR’s longstanding structure, charters could be revoked or renewed at the organization’s discretion, unlike the permanent franchise rights found in other major professional sports.
After two years of contentious negotiations over a new charter agreement and a deadline that gave teams only hours to agree to a 112-page document, the two teams refused to sign and initiated legal action.
23XI and Front Row argued that the system limited competition and undercut their financial stability, even as other organizations reluctantly signed the offer “with a gun to our head,” according to testimony revealed during the trial.
While the specific financial terms of the settlement were not made public, the core outcome is significant: charters will now be made permanent for all NASCAR teams beginning with the 2026 season, effectively addressing the central point of contention in the lawsuit.
In addition, both 23XI Racing and Front Row Motorsports will regain the three charters they had lost during the litigation, providing long-term security and eligibility for revenue sharing moving forward.
U.S. District Judge Kenneth Bell, who presided over the trial, encouraged the settlement, noting that sometimes parties must allow evidence to unfold before reaching common ground.
Outside the federal courthouse, Jordan said the settlement was reached because both sides “got to that point” where cooperation served the sport’s best interests. Jordan highlighted the importance of thinking not just for individual teams but for NASCAR as a whole.
“It’s about synergy,” he said, adding that he believes the agreement will help grow the sport. NASCAR Chairman and CEO Jim France echoed the sentiment, expressing optimism that the parties can now refocus on racing and expanding NASCAR’s reach.
23XI co-owner Denny Hamlin also praised the outcome, framing the protracted fight as a necessary step to create sustainability, stability, and opportunity for teams, drivers, and the broader NASCAR community.
Photo Credit: DepositPhotos.com
