Breaking News: 23XI, Front Row must complete Stewart-Haas acquisitions and resubmit their court confession for NASCAR charters.

In a formal re-filing of their preliminary injunction plea in district court on Tuesday evening, 23XI Racing and Front Row Motorsports asked the judge to grant them chartered status for the duration of their case against NASCAR, alleging imminent irreparable harm this time.

An injunction is a court-ordered remedy to lessen damages; it is considered preliminary since it is issued before the court proceedings begin.

On November 8, Frank D. Whitney, the district judge of the Western District Court of North Carolina, who was in charge of the case, rejected the initial request, ruling that irreparable harm was only a possibility and not a guarantee. He also said that “should circumstances change, Plaintiffs may file a renewed motion,” which they have done.

On the grounds of four “changed circumstances,” three of which were redacted in the legal filing on Tuesday night, the teams withdrew their initial appeal to Virginia’s fourth circuit court. NASCAR’s decision on November 16 to eliminate a clause from the non-chartered entry form that prohibits teams from pursuing antitrust lawsuits against the Sanctioning Body was the one that wasn’t removed.

Despite removing the release from the open agreement, NASCAR has left it in the SHR Charter Agreements. This puts the plaintiffs in a precarious situation where they must decide within three weeks whether to conclude their deals and risk having their antitrust claims dropped or to pass up the priceless chance to buy charter rights for a different vehicle.

In order to “avoid the irreparable loss of rights before judgment,” Plaintiffs ask the Court to bar Defendants from pursuing enforcement of the SHR Charter Agreements’ release against their antitrust claims for the duration of this litigation.

To put it another way, the teams are claiming that until NASCAR removes the clause in those charters that prohibits teams from suing them, they cannot finalize the deal to buy those charters.

They contend that issue must be resolved before the year ends, when their existing charter status expires, and that it is still unclear what will happen to their charters if an agreement is not reached.

Despite not agreeing to the additional terms with the four combined charters they currently hold, 23XI and Front Row are trying to obtain a charter that has accepted the new provisions when Joe Custer and Gene Haas of Stewart-Haas Racing signed the 2025 charter contract.

The two Stewart-Haas charters are not included in NASCAR’s declared intention to field 32 chartered teams and eight open teams for the upcoming season. It is necessary to settle this transaction and the charter status of 23XI and Front Row before the upcoming season, as the Haas Factory Team will not field cars for those charters regardless of what happens next season.

Last Monday, Riley Herbst was formally announced by 23XI Racing as the driver of the new third car.

In order to allow Plaintiffs to complete those transactions without jeopardizing their antitrust rights, the Court should, at the very least, rule that Plaintiffs’ antitrust claims are not covered by the release in the SHR Charter Agreements, even if it finds it is still too early to issue a preliminary injunction.

Translation: Front Row and 23XI are requesting that the court step in and permit the teams to buy the two charters without forfeiting their right to pursue an antitrust action against NASCAR, which would be required if they were to buy them outright.

The teams also claim that because they are in the process of concluding sponsorship agreements and “cannot provide assurances that they will have charter rights,” they are in danger of suffering irreversible harm.

Translation: 23XI Racing and Front Row wish to finalize the purchase of the third charters without relinquishing their legal rights to sue on the grounds that they purchased charters that complied with the section 10.3 release clause, even if the court again rejects the teams’ request for charter protection for 2025, forcing them to play as open teams the following season.

Additionally, because (a) it is an illegal exclusionary conduct to preserve NASCAR’s monopolistic power and (b) it is unable to disclose future antitrust offenses, the Court may decide that the release is void as against public policy. The Court should now decide that the defendants cannot exploit the SHR charter agreements’ anticompetitive release as a means of maintaining their monopoly.

The teams are also still arguing that running as open teams will produce imminent harm due to the possibility that they could miss races like the Daytona 500, or any race next season, and the opt-out clauses sponsors and drivers have should both teams not hold charters next season.

The counsel for the teams’ statement
23XI and Front Row Motorsports are presenting the court with a second preliminary injunction based on fresh evidence, in accordance with Judge Whitney’s previous decision. As part of their monopolistic control, my clients are also requesting this action to invalidate the release clause that NASCAR eliminated from its open agreement but continues to use in its charter agreements. I have faith that the court will take action to shield my clients from NASCAR’s anticompetitive behavior.

What comes next?
NASCAR must now file a response. The teams wants it by December 6 and NASCAR wants December 9. The teams then must reply to that. Teams want to respond by December 10 but NASCAR wants December 11. Teams wants a hearing on December 12 or 13 and NASCAR wants a date at the court’s discretion.

Simplify this
Before the two teams’ antitrust lawsuit against NASCAR can proceed, what becomes of the charters they hold and those they purchased needs to be determined. The teams want to maintain the status quo of chartered protection until judgement or a settlement, despite not signing the deal that preceded this lawsuit. NASCAR rejects this proposal on the basis that the teams did not sign the agreement and should run as open teams, which is something 23XI and Front Row have publicly stated an intent to. In any case, this has to be resolved before the start of the season, much less before the lawsuit itself can even begin in earnest.