NASCAR Faces $364.7M Antitrust Lawsuit, Economist Reveals

An economist has revealed that NASCAR could face a hefty $364.7 million antitrust lawsuit due to revenue-sharing disputes with two teams. During the ongoing trial involving Michael Jordan, Professor Edward Snyder testified about NASCAR’s alleged monopolistic practices and the financial impact on the teams involved.

NASCAR’s Antitrust Lawsuit Overview

The lawsuit concerns a revenue-sharing disagreement linked to the controversial 2025 charter agreement. This agreement was presented on a Friday in September 2024, giving teams a same-day deadline to evaluate and sign a lengthy 112-page document.

Key Details of the Case

• Teams Involved: The dispute primarily involves 23XI Racing, co-owned by Jordan and Denny Hamlin, and Front Row Motorsports, owned by Bob Jenkins.
• Charter System: NASCAR’s charter system, initiated in 2016, grants only 25% revenue sharing to teams, compared to the 45% sharing model reportedly used by Formula 1.
• Revenue Estimates: Snyder estimated 23XI Racing is owed $215.8 million, while Front Row Motorsports is due $148.9 million, based on complex profitability calculations.

Economic Findings

Snyder’s analysis indicates that from 2021-2024, NASCAR shorted its chartered teams a total of $1.06 billion. He emphasized that NASCAR’s exclusive agreements with racetracks limit teams from exploring other options. This control over tracks and teams points towards alleged anticompetitive practices.

NASCAR’s Response

NASCAR has contested Snyder’s findings. The organization argues that his comparisons with Formula 1 are flawed and that its own expert economists refute his calculations. The race series, which has $2.2 billion in assets and an equity value of $5 billion, aims to demonstrate that its practices are fair.

Trial Progress and Expectations

The trial has drawn attention for its slow pace, prompting U.S. District Judge Kenneth Bell to suggest extending jury hours to expedite proceedings. The court session has seen various objections and procedural discussions that have delayed testimony.

Upcoming Testimonies

NASCAR chairman Jim France, commissioner Steve Phelps, and Richard Childress, a Hall of Fame team owner, are expected to testify as part of the proceedings. Judge Bell has emphasized the need for a quick resolution to the trial, urging attorneys to expedite their cases.

This antitrust case highlights the complex dynamics within NASCAR and the significant financial stakes involved for the teams. As the trial unfolds, its outcomes could reshape the future of revenue sharing and competition within the sport.