NASCAR Sues Michael Jordan’s 23XI Racing and Business Partner in Legal Battle Over Charter System
Charlotte, N.C. — In a dramatic twist in the ongoing saga between NASCAR and race teams, NASCAR filed a federal lawsuit on Wednesday accusing Michael Jordan’s 23XI Racing team and his long-time business partner, Curtis Polk, of engaging in an illegal scheme aimed at securing better terms for the teams during negotiations. The suit, which includes a counterclaim from NASCAR against both 23XI Racing and Front Row Motorsports, escalates tensions that have been brewing for years over NASCAR’s “charter system” and its associated financial agreements.
NASCAR’s Allegations: Cartel Behavior and Illegal Schemes
NASCAR has filed a lawsuit accusing 23XI Racing, Front Row Motorsports, and Curtis Polk of orchestrating a coordinated effort to pressure NASCAR into agreeing to favorable terms for the teams. The suit claims that Polk, a co-owner of 23XI Racing and an advisor to Jordan for decades, spearheaded the scheme. According to NASCAR, the teams engaged in media campaigns, threatened boycotts, and even interfered with NASCAR’s broadcast agreement negotiations in an effort to manipulate the situation.
The lawsuit goes as far as calling the teams involved “an illegal cartel” that engaged in coordinated conduct to undermine NASCAR’s attempts to secure fair and legal agreements. Polk is accused of heading the charge by coordinating team actions, discouraging teams from backing out of the conspiracy, and disrupting NASCAR’s efforts to renew its media rights agreements.
The Battle Over NASCAR’s Charter System
At the heart of the legal dispute is NASCAR’s charter system, which guarantees certain financial benefits and a starting position in every race for teams that hold a charter. This system is effectively NASCAR’s version of franchise ownership and has been a point of contention for years
The charter system has been a key revenue driver for NASCAR, and it ensures that teams with charters are guaranteed a financial stake and participation in the 36 races that comprise the Cup Series. However, this arrangement has not been without its complications. As negotiations over its renewal have dragged on, some teams have sought permanent charters, a request that NASCAR has been reluctant to grant. This ongoing struggle over the future of the charter system came to a head in October 2024 when 23XI Racing and Front Row Motorsports filed a lawsuit accusing NASCAR of engaging in “anticompetitive and exclusionary practices.”
The lawsuit filed by 23XI and Front Row Motorsports also alleges that NASCAR has exploited the system for its own benefit, to the detriment of the teams. This claim adds to the longstanding tension between NASCAR’s leadership, headed by CEO Jim France, and the teams that are pushing for a larger share of the sport’s financial pie.
NASCAR’s Response: Legal Repercussions and High Stakes
In its counterclaim, NASCAR has sought triple damages and has demanded that 23XI Racing and Front Row Motorsports be stripped of their guaranteed starting positions in Cup Series races should they continue with the litigation. The threat is clear: If the teams prevail in their legal challenge to the charter system, it could fundamentally alter the structure of the sport. As NASCAR’s attorney Chris Yates explained, “If they prevail, the charter system likely goes away.”
NASCAR’s stance is firm. The organization has indicated that it is not interested in settling, stating that it does not intend to renegotiate the charter agreement. The lawsuit represents a high-stakes gamble, with both sides looking to secure the most favorable terms in the years to come.
The Battle Intensifies: Court Dates and Expanding Teams
As this legal battle wages on, both 23XI Racing and Front Row Motorsports have continued to grow and compete within NASCAR. Despite the ongoing lawsuit, both teams expanded in the offseason, with 23XI and Front Row securing third charters and fielding three full-time teams for the upcoming season. A federal judge ruled in December that the two teams could race as charter teams in the 2025 season while the legal proceedings continue.
The conflict has now moved to the courts, with a jury trial scheduled for December 1, 2025, regarding the joint lawsuit filed by 23XI and Front Row against NASCAR. Meanwhile, NASCAR has appealed the December ruling that allowed the teams to race as charter teams in 2025. The appeal is expected to be heard by the U.S. Court of Appeals in mid-May.
NASCAR’s Broader Strategy and the Future of the Charter System
As the case develops, NASCAR’s legal team has been vocal about the behavior of the Race Team Alliance (RTA), a group of 15 teams that own charters and act as a collective bargaining unit. NASCAR’s lawyers argue that the RTA behaved like a “cartel” when it formed and participated in negotiations, particularly through the Team Negotiation Committee (TNC), which included Polk, Joe Gibbs Racing president Dave Alpern, and others. NASCAR accuses this group of deterring potential new ownership from entering the sport by making the charter system an unappealing investment.
One example cited in the lawsuit involves Xfinity Series team owner Dale Earnhardt Jr., who was reportedly discouraged from buying a charter after learning about the difficulties surrounding the system.
A Divisive Legal Saga with No Clear Resolution
With both sides entrenched in their positions, this lawsuit is far from over. NASCAR’s desire to maintain the charter system as it stands and the teams’ wish for better terms and protections have set the stage for what could be a landmark legal case in the world of sports.
As the legal proceedings unfold, the implications for the future of NASCAR’s business model and the teams involved are significant. The outcome of this case may well redefine the sport’s structure, its financial landscape, and its long-term viability. For now, it seems that the race off the track is as fierce as any competition on it.
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