A U.S. District Court judge refused Thursday to grant 23XI Racing and Front Row Motorsports a temporary restraining order to compete as chartered teams, meaning both organizations will be classified as open teams this weekend at Dover Motor Speedway.
Open teams are not guaranteed a starting spot, but that won’t be a problem for 23XI Racing and Front Row Motorsports this weekend. A full field is 40 cars. Only 37 cars are entered at Dover. Both organizations, though, will receive less money because they no longer have charter status and will not receive the extra income charter teams do.
“We are disappointed that the court declined to grant 23XI and Front Row Motorsports a temporary restraining order to allow the teams to continue racing as chartered teams,” said Jeffrey Kessler, attorney for 23XI Racing and Front Row Motorsports, in a statement. “We remain confident that our motion for a preliminary injunction is legally warranted and necessary, and we look forward to the court’s full review.
“The court made it clear it is only denying the temporary restraining order because NASCAR has agreed to preserve our charters until the preliminary injunction can be decided and because we are assured of qualifying all our cars the next two weeks so that there will be no irreparable harm before the preliminary injunction can be fully briefed and ruled upon.
“We made the decision to bring this lawsuit to challenge NASCAR’s monopolistic practices and bullying tactics, and we are not going to let them push our teams – or others – out of the sport that they love. We are confident in the merits of our case and the teams remain focused on competing this weekend and continuing their playoff push.”
23XI Racing, co-owned by Michael Jordan and Denny Hamlin, and Front Row Motorsports, owned by Bob Jenkins, had sought a temporary restraining order and a preliminary injunction to compete as chartered teams. They have competed as chartered teams all season — despite not signing the charter agreement last year — after U.S. District Court judge Kenneth D. Bell granted a preliminary injunction last December.
NASCAR appealed the preliminary injunction order to the Fourth Circuit Court of Appeals. A three-judge panel from that circuit heard oral arguments May 9 and vacated the preliminary injunction June 5. The two teams asked the full Fourth Circuit Court of Appeals to hear the matter. The court declined to do so July 9. The teams went back to U.S. District Court this week to request a temporary restraining order and preliminary injunction to compete as chartered teams, leading to the court’s decision to deny a temporary restraining order Thursday.
No decision was made on the preliminary injunction.
23XI Racing employs drivers Tyler Reddick, Bubba Wallace and Riley Herbst. Front Row Motorsports’ drivers are Todd Gilliland, Noah Gragson and Zane Smith.
Two teams state in court documents that “they once again will face the prospect of losing key sponsors and star drivers” if they lose their charter status.
23XI Racing and Front Row Motorsports asked the court Monday to be allowed to continue to run with chartered status, citing new evidence uncovered in discovery.
The teams stated in court documents: “Since the Fourth Circuit’s decision, NASCAR has signaled its intention to immediately move to sell or issue Plaintiffs’ charters to other entities — putting Plaintiffs in irreparable jeopardy of never getting their charters back and going out of business.
“As the Court has already found, it is not economically viable for a team to participate in the Cup Series on a long-term basis racing under an “open” agreement. Moreover, if Plaintiffs are forced to relinquish their charters before trial, they once again will face the prospect of losing key sponsors and star drivers, who will have the right to terminate their contracts and have already signaled their intention to pursue driving opportunities with other teams (should Plaintiffs lose their charter rights).”
But in its response Wednesday, NASCAR denied that claim. NASCAR stated in court documents: “Although based on the false premise that Plaintiffs have Charters, and notwithstanding the substantial interest in Charters from motorsports companies racing in INDYCAR, Xfinity, and other series, NASCAR has represented it will not sell any Charters before the Court can rule on Plaintiffs’ motion for preliminary injunction.”
Bell noted NASCAR’s response in his ruling.
“With respect to irreparable harm, Plaintiffs (23XI and Front Row) have expressed several concerns,” Bell wrote in his six-page order. “First, they claim that the transfer of the Charter spots Plaintiffs had been using prior to this dispute and have purchased would “destroy their businesses” under the current Charter Agreement regime.
“This is a fair and significant fear; however, NASCAR has agreed that it “will not sell any Charters before the Court can rule on Plaintiffs’ motion for preliminary injunction.”
NASCAR files response to 23XI Racing and Front Row Motorsports requesting this week to have charter status through the rest of the season after it expired.
The teams also raised concerns about the harm of not having charter status as they have had all season.
Bell addressed that, writing: “Similarly, Plaintiffs worry that denying them guaranteed entry into the field for upcoming races could adversely impact their competitive standing, including their ability to earn a spot in the playoffs.
“Again, a legitimate, potentially irreparable harm. Yet, akin to the sale of Charters, NASCAR represents to the Court that all of Plaintiffs’ cars will qualify (if they choose to race) for the races in Dover and Indianapolis that will take place during the next 14 days, the initial length of time during which the Court can enter a (temporary restraining order) under Rule 65. Therefore, Plaintiffs will not suffer any harm from being at risk of a failure to qualify for races until the Court rules on the Preliminary Injunction.”
The teams also have raised the harm of not having charter status could have in terms of sponsors and driver contracts.
On that matter, Bell wrote: “Finally, Plaintiffs say they face the threat of the irreparable loss of drivers and sponsor relationships and opportunities. With respect to drivers, the record stands in a different posture than it did prior to the season when the Court entered the earlier injunction.
“While Plaintiffs’ drivers could have realistically terminated their contracts with Plaintiffs and/or been lured away by other teams, that prospect (although theoretically still conceivable) appears unlikely at this late stage of the season, and Plaintiffs have not offered evidence that any drivers are intending to do so in the next two weeks. Moreover, Plaintiffs have not established an imminent loss of sponsorships before the Preliminary Injunction can be decided.”