The NASCAR antitrust lawsuit, one of the most anticipated activities in the sport recently, has finally come to a mutual settlement. Both 23XI Racing/Front Row Motorsports (the plaintiffs) and NASCAR have made some compromises that are yet to be released. However, there seems to be a major agreement benefiting the plaintiffs and their primary demands.

Having permanent charters was one of the key demands from the plaintiffs, and a settlement has been made relating to the same. Safe to say, Denny Hamlin and Co. seemed rather happy with the decision. What is the settlement about?

What does the NASCAR lawsuit settlement say about evergreen charters?

Both 23XI Racing and Front Row Motorsports filed the antitrust lawsuit in October 2024. The primary reason was the new Charter Agreement, which had understandably left many teams unhappy. Both teams refused to sign the agreement. They demanded permanent charters, which would not only increase their value but also give all the teams more security and financial benefits.

This has been a primary topic of dispute between all the teams and NASCAR for a long time. However, giving the teams permanent charters instead of renewable agreements would have meant that the sport would lose control over them. But as per the latest settlement, the teams will now get “evergreen” or permanent charters. 

This would mean that teams will be able to keep their charters indefinitely.

Moreover, teams will also share in international revenue for the first time, as per the settlement. They will be getting 1/3rd of the intellectual property revenue, which includes the broadcasting deal. This was also a part of the primary allegation in the lawsuit.

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How was the 2025 Charter Agreement handled in the settlement?

The settlement is a huge victory for both 23XI and FRM. Unlike other teams on the field, they had not signed, or weren’t forced to sign, the 2025 Charter Agreement. However, a preliminary injunction shortly after the lawsuit allowed them to race as chartered teams, although it was overturned, and they raced as open teams for the remaining season.

But, the settlement effectively changes the agreement now, meaning that not only the charters will be permanent, but both of the teams will be a part of the amendment and will race as chartered teams going ahead.

In addition to that, some further changes in the four pillars of the Charter Agreement are also expected to come. The four pillars include charter permanence, revenue sharing, governance, and product development.

Why there’s no public financial disclosure in the NASCAR settlement

As it usually happens in a high-profile lawsuit like this, there was no financial disclosure of the settlement. There are several reasons for this, which could include public perception, protecting future negotiations, etc.

It is usually a standard practice for both the plaintiffs and the defendants to sign NDAs and not reveal the exact financial settlements. This is exactly the practice that both the teams and NASCAR followed in this lawsuit, releasing only statements confirming the mutual settlement.

How 23XI and FRM could get their charters back?

As mentioned, both 23XI and FRM were allowed to race as chartered teams in the 2025 Cup Series season. However, this was rather odd, considering they had not signed the agreement and had filed the lawsuit regarding the agreement itself. Owing to this and several other reasons, the preliminary injunction was later overturned by the court.

Both teams continued to race as open teams, which did not guarantee them an entry in all the races. However, with the settlement, all six charters will be given back to them. 23XI and FRM had made deals with Stewart-Haas Racing, purchasing two of their charters prior to this season.

When the dispute is completely resolved, the teams are expected to get their charters back. Moreover, it will be according to the amendments that will be made in the Charter Agreement. This is a huge victory for both teams.

What happens with the 2025 season payouts and team revenue?

Neither the plaintiffs nor the defendants have made a public revelation of the settlement. However, owing to the nature of the settlement and the positive signs from 23XI’s co-owner, Denny Hamlin and Michael Jordan, it is expected that NASCAR will compensate the teams for the 2025 season.

This would not encompass simple compensation. Instead, they will be paid out the charter-equivalent revenues. They would have earned this if they had continued racing as chartered teams throughout the season.

This lawsuit has brought a major shift in NASCAR and its policies. It is understood that the sport’s authorities were never in favor of making the charters permanent; however, that has been overturned as per the settlement. With the “evergreen” Charters, their valuation will not only increase, but will also benefit the teams in the future.

It was claimed that running the cars under the current Charter Agreement had been putting the team at a loss. This was because of the share of the media payout. However, with evergreen charters and other amendments in the agreement, the teams are now expected to have brighter futures, all thanks to 23XI and FRM, who kept themselves at risk throughout the season.