Jordan goes to court on first day of high-stakes NASCAR antitrust trial

CHARLOTTE, NC (AP):

THE FEDERAL antitrust trial against NASCAR opened yesterday with the star power of Michael Jordan on hand as a jury of nine was seated to hear allegations that the stock car series is a monopolistic bully that leaves its teams no option but to comply with rules and financing they don’t agree with.

The retired NBA Hall of Famer is the co-owner of the 23XI Racing team at the top Cup Series level. 23XI and Front Row Motorsports sued the series last year rather than sign extension agreements on new charters, which are franchise-type designations that serve as the framework for the revenue stream between NASCAR and the teams.

The stakes are huge: The charters are at the heart of NASCAR’s business model – they guarantee a car a spot in the field each race week, as well as a percentage of the purse – and the disputes over how they work have dominated the series of late. A loss for the two teams could oust them from the series, while a loss for NASCAR could mean a fundamental restructuring of how the series operates.

Six men and three women were seated for a trial expected to last two weeks before US District Judge Kenneth Bell, who asked for opening statements to be completed late yesterday. Bell ruled that 23XI co-owner and star driver Denny Hamlin and Curtis Polk, the long-time business manager for Jordan and part of the team’s ownership group, will be sequestered after opening statements before they testify.

Jordan’s presence in the courtroom gallery near Hamlin was a factor: Among those dismissed from serving on the jury was a man who said he can’t be impartial because “I like Mike”, and another who said he had Michael Jordan posters on his walls growing up. A juror said they were a North Carolina fan, but noted the football team at Jordan’s alma mater is not “doing too well right now”, to which the retired star shook his head and laughed.

NASCAR executives in the courtroom included Chairman Jim France and Vice-Chair Lisa France Kennedy, two scions of the family that founded NASCAR in 1948 and still owns it.

23XI and Front Row were the only two teams out of 15 to refuse to sign extensions on new charter agreements last fall. The teams wanted multiple concessions, and when they didn’t get them, they went to court. The case has churned through hearings and arguments for more than a year despite calls from other NASCAR teams to settle. Bell even helped mediate a failed two-day summit in October.

A NASCAR victory could put 23XI, Front Row and their six combined cars out of business. Their charters – now being held by NASCAR – would likely be sold. The last charter went for $45 million, and NASCAR has indicated there is interest from potential buyers including private equity firms.

A win for the teams would lead to monetary damages and the potential demolition of NASCAR as it is run today. The judge has the power to unravel a monopoly, and nothing is off the table, from ordering a sale of NASCAR to the dismantling of the charter system.