NASCAR argues that 23XI, Front Row are not suffering due to non-charter status

NASCAR believes 23XI Racing and Front Row Motorsports have no standing to claim they are suffering from not having charters this season, as they will qualify for all remaining races, and none of their drivers have left their race teams.

The argument is one of a handful from NASCAR included in a late Monday night filing in opposition to the two organizations seeking a new preliminary injunction. Both sides will be in court Aug. 28 for a hearing on the matter, which will determine if 23XI and Front Row are recognized as charter teams. 

NASCAR made a rule book change in July that ensures the two organizations will not miss qualifying for a race. Up to six Open teams will make the field based on owner point rankings, per the new rule. There are six combined teams between 23XI and Front Row. 

23XI Racing and Front Row Motorsports did not sign the 2025 charter agreement. The other 13 teams in the Cup Series garage did. However, through the legal process, both organizations have stated they will continue to race regardless of charter status, which NASCAR cited in its filing.

Another part of NASCAR’s argument is that there is no harm to the organizations in not having charters for the 2026 season. The charter agreement negotiations occurred over two years, and 23XI Racing and the filing states that Front Row were aware of the offered terms before the charters expired in December 2024. 

According to the filing, “Plaintiffs’ theoretical inability to obtain Charters post-trial also does not justify NASCAR from selling or transferring Charters, because Plaintiffs do not have Charters now because of their own strategic choices… Plaintiffs had multiple opportunities to acquire 2025 Charters, and they squandered them.”

23XI Racing and Front Row had four combined charters during the 2024 season, and each organization bought a third one from Stewart-Haas Racing. NASCAR, however, has previously argued that by not signing the charter agreement, the two organizations have no rights to charters and NASCAR is free to move them. And NASCAR doesn’t believe a court can order them into a partnership with those they are not interested in doing business with (i.e., 23XI and Front Row, as they didn’t sign the agreement).

NASCAR now argues that 23XI and Front Row wanting the court to keep NASCAR from moving the charters is harming the sport. Since there are interested parties (those in NASCAR and other racing motorsports) in the charters, NASCAR wants to present them an opportunity to bid on the charters to be able to prepare within the appropriate timeframe to race in 2026.

And on the allegation that NASCAR is a monopoly, the filing addresses that “the ever-increasing payments NASCAR has made to Teams also destroy Plaintiffs’ claim that NASCAR holds monopsony power.” NASCAR increased the payment to the race teams by 28% in the 2016 charter agreement, and then increased the payments by 62% in the 2025 agreement. 

“NASCAR pays Teams more than even Formula 1 as a percentage of profit (the metric Formula 1 uses),” the filing states. “Plaintiffs ignore the pay raises the Teams received. Instead, they focus on a text during negotiations for the 2025 Charter that said an internal version of the May 2024 draft contained ‘zero wins’ for Teams. Plaintiffs ignore that the actual May 2024 draft proposed to Teams carried forward the biggest win for the Teams – a massive pay increase – that was set out in the December 2023 draft. It also gave Charter holders an opportunity to obtain any improved extension terms NASCAR offered to third parties and increased Teams’ ability to receive investor funding, among other benefits.”

NASCAR commissioner Steve Phelps filed a declaration with NASCAR’s filing that addresses another area of the monopoly accusations when it comes to competing in other motorsports. Phelps states that charter holders are allowed to participate “in numerous” other series, and cites the CARS Tour as an example. According to Phelps, NASCAR has never withheld approval to race in other series, and that 23XI and Front Row have never asked for approval to do so.

23XI Racing and Front Row Motorsports were granted charters entering the 2025 season. However, that order was vacated in June, and the two organizations have raced as Open teams since. But they have filed for a new preliminary injunction as they seek to be charter holders, and the Aug. 28 hearing will be held before the start of the NASCAR Cup Series playoffs and the final 10 races of the season.