New day, new drama in NASCAR’s legal saga, and this time it’s straight from the top dog’s mouth. NASCAR Commissioner Steve Phelps stepped into the spotlight on CNBC News, trying to cool the flames of the ongoing lawsuit with 23XI Racing and Front Row Motorsports. But let’s roll back a bit.

The lawsuit was officially filed on October 2, 2024, in North Carolina’s Western District. It alleges that NASCAR engages in monopolistic practices through its charter agreement, a system that grants guaranteed race entries and revenue shares to teams. The suit specifically targets a clause in the proposed 2025 Charter renewal that would bar teams from suing NASCAR once signed — a clause 23XI and Front Row claimed forced silence and hindered fair negotiations. As a result, both teams refused to sign the agreement, yet wanted to continue competing as chartered teams, setting up a legal impasse.

Cut to June 2025, and while discussing a plethora of topics, when the host diverted the conversation towards the lawsuit, he asked Phelps to explain in layman’s terms what the lawsuit is all about. Phelps was quick to break down the events of the lawsuit. “So the suit was brought by 23XI, which is the company that majority owner is Michael Jordan and minority owner is Denny Hamlin, who is one of our very successful drivers. With 158 Cup races, he’s a tremendous talent. I am not sure why they decided to bring the suit and there’s another team called FrontRow that also partnered with them on this suit. It is an antitrust case. We don’t believe it’s an antitrust case.” 

While fans knew all of that, there’s something even bigger. Phelps revealed details of what they offered teams while he went on defending the case from NASCAR’s end. “There is a significant increase in revenue that the teams got so over the period of time, the increase that we offered the race team contract to contract was 23%. That’s a significant increase, if you are a monopolist, you have that behaviour, you’re not gonna increase by 73%, you’re actually gonna go backwards because you have that ability to do it, for us that’s not what we wanted to do because we need healthy race teams,” Phelps said, painting NASCAR as the good guy just looking out for its teams.

But here’s the rub: Phelps’ claim of generosity feels like a classic monopoly move of tossing out a shiny number to dodge the heat. If NASCAR’s so keen on “healthy race teams,” why the iron grip on financial transparency? Opening the books could expose NASCAR’s cut of the pie, especially since they’re all chasing the same sponsorship dollars as the teams. That kind of conflict could spark chaos, and NASCAR knows it.

Closing it all, while maintaining a diplomatic stance, Phelps said, “We are obviously defending ourselves vigorously. It’s two options: settle or go to trial. As I sit here today, I have no idea of what’s gonna happen. Personally, I like Michael Jordan and I think that he’s brought some new eyeballs to the sport. He’s very competitive, he’s a good guy. It’s unfortunate that we’re in this legal spat.”

He is acknowledging the massive cultural impact Jordan has had since launching 23XI Racing in 2020. Jordan’s entry into NASCAR brought significant mainstream attention, especially from non-traditional fan bases, and helped diversify and expand the sport’s reach. His partnership with driver Bubba Wallace  being the only full-time Black driver in the Cup Series . It has been crucial in NASCAR’s diversity and inclusion efforts.

A trial could force a full legal review of NASCAR’s charter structure, potentially opening the door to major reforms or legal precedents that alter how NASCAR interacts with its teams. However, a settlement could resolve the conflict behind closed doors and maintain business continuity. Only time will tell whether they decide to, like Phelps mentioned, “settle or go to trial”.

NASCAR Gains Upper Hand in Escalating Legal Battle

The plot thickened yesterday when Bob Pockrass dropped a bombshell on X, “Judge ordered the non-suing teams to provide the financial information in the manner that those teams had offered to provide to NASCAR (NASCAR had wanted more detailed from each team). Only attorneys and their experts can view it.”

The Western District of North Carolina court laid it out: by noon on June 27, NASCAR and the 13 non-suing Cup teams, like Joe Gibbs Racing and Hendrick Motorsports, must pick an independent accounting firm to handle anonymized financial data. If they can’t agree, each side picks a name for the court. Teams have to fork over per-car revenue, costs, and profits/losses from 2014 onward, including sponsorship cash, but only for Cup Series ops.

The firm will whip up a “Highly Confidential Attorneys Eyes Only” spreadsheet for NASCAR and the plaintiffs’ legal teams, with NASCAR covering the accountant’s bill. This gives NASCAR ammo to argue teams aren’t hurting financially, countering 23XI and Front Row’s claims. Meanwhile, 23XI’s struggling on track Tyler Reddick’s point-strong but winless, and Bubba Wallace is reeling from a Pocono disaster.  The legal heat’s on and everyone is hooked in, eagerly waiting for the next update.