Barring any last-minute out-of-court settlement – which appears unlikely but could ultimately be the best conclusion for all sides instead of a lengthy and costly legal fight – one of the most contentious lawsuits in NASCAR history will begin Monday morning in downtown Charlotte, N.C.

The legal battle pits NASCAR vs. two of its teams: 23XI Racing, co-owned by NBA legend Michael Jordan, his longtime business partner Curtis Polk, and current NASCAR Cup star Denny Hamlin, as well as Front Row Motorsports, owned by Bob Jenkins.

At stake are a number of things, including the ultimate defining power and control of the sport by NASCAR and its owners, the France family, as well as significant amounts of money that could go to either the teams or the sanctioning body, team charters and values, allegations of anti-trust violations vs. NASCAR, and more.

How the case plays out – and with the likelihood that it could be a long, drawn-out courtroom fight (although initially pegged to last roughly three weeks, there will likely be the certainty of appeals to follow) – will likely shape the direction of the sport and its future.

If NASCAR ultimately wins, it will further cement the France family’s solitary control of the sport. But if the two teams win, the likely end result is that it will at least partly diminish NASCAR’s omnipotent power and give all Cup teams more control over their own destiny and future, not to mention having a likely increase in individual value for each team in the series.

While one side will emerge victorious from a legal standpoint, in the end, both sides could wind up losing. If NASCAR wins, it will maintain its hold over the sport. It could also potentially spell the eventual end of at least one of the teams, as Jordan has threatened to close up shop at 23XI if NASCAR holds serve in the courtroom.

If 23XI loses and Jordan fulfills his threat of leaving the sport, it will be a major blow to NASCAR. The sanctioning body may very well win the battle but it stands the risk of losing its most high-profile minority team owner, and in doing so, potentially alienate minority fans – many who’ve entered the sport over the last few years because of the NBA legend’s involvement and the sport’s marked initiative to draw more African-American fans and Hispanic fans who follow Spire Motorsports driver and Mexican native Daniel Suarez (Spire and Suarez are not part of the lawsuit).

However, if the two teams win in their arguments that claim NASCAR violates anti-trust regulations and maintains unfair monopolistic control, the outcome could ultimately alter the face of the sport forever. Depending on the outcome, NASCAR could be forced to cede much of its control over the sport – most notably in business operations – as well as share revenue more equitably with teams.

NASCAR could also see its current charter system – which was originally designed in theory to maximize the value of teams and give them greater equity and involvement in the direction of the sport – radically altered to give teams more power than they currently have, something they’ve sought for years but which NASCAR has refused to cede over.

How did we get to this point?

The legal battle has been going on since the two teams sued NASCAR in October 2024. Since then, there have been numerous back-and-forth allegations, as well as the recent bombshell discovery of acrimonious text and email messages mainly from NASCAR officials or officials of teams that support NASCAR’s contentions. However, because they’ve already been ruled inadmissible and released publicly by the court, those texts and emails cannot be used by either side in their legal arguments.

Boiled down to the most simplistic terms, the biggest reason for the lawsuit is money: the two teams contend NASCAR keeps too much revenue for itself – most notably the current $7.7 billion TV package that runs through 2031 – and doesn’t share the wealth more with its teams. Jordan has said several times that he’s not pursuing the lawsuit to further enrich his own multi-billionaire status, but more so to force NASCAR to more equitably share the wealth, particularly with smaller (and oftentimes less competitive) teams such as 23XI and FRM.

If NASCAR succeeds, it could permanently take away the six charters the two teams hold in total – three charters each – and sell them to other existing teams that are standing with NASCAR or to potential new ownership groups and investors to create additional teams.

If that were to happen, both teams would no longer have any of the significant perks of ownership that other teams with charters currently enjoy, including greater shares of revenue and automatic starting berths in every Cup race. That means if they continue on without charters – which is unlikely – 23XI and FRM would have to qualify for every race they enter.

Qualifying for a race is hard enough, but without a guaranteed starting spot in the usual 36-to-38 cars per race grid (sometimes as many as 40 cars), if they fall short in qualifying, 23XI and FRM would potentially run the risk of missing a race if more than 40 cars enter for a particular event – most notably a major race such as the season-opening Daytona 500, the sport’s biggest and most lucrative contest.

Another significant element of the lawsuit is the teams’ antitrust contention that NASCAR holds an ownership monopoly over tracks that host the Cup Series (NASCAR owns 17 tracks, of which 11 host 22 Cup events each season – just under two-thirds of the 36-race regular season).

That monopoly extends, the lawsuit contends, to competing companies such as Speedway Motorsports Inc. and Indianapolis Motor Speedway, who reportedly must clear other types of racing events they host (for example, when SMI tracks host NHRA drag racing events at places like Bristol, Charlotte and Sonoma) with NASCAR first, essentially giving NASCAR the first right of refusal – although it has rarely used that right in the past.

And then there’s the charter system

NASCAR’s charter system will also be on trial as part of the lawsuit. The charter system came into being in 2016 and serves as a way to give teams more of a feel of a true franchise, as we see in other pro sports such as the NFL, MLB, NBA, and others whose teams are privately owned. Currently, there are 36 charters in the Cup Series (which, for now and until the suit is settled, include the six charters held by 23XI and FRM).

Charters are technically sold to the highest bidder, but at the same time, teams that have existing charters can also lease or even sell those charters to other teams. The value of charters can range based on what those teams value them at, typically between $30 to $50 million apiece.

One interesting aspect of the current charter system is that every existing Cup team that holds at least one charter (and some as many as a maximum of four) has chosen to side with NASCAR and not join 23XI and FRM in the suit.

On the surface, that may give the impression that owners of those teams are supporting NASCAR’s side in the suit, when in reality it may make more sense legally and financially for those same teams to stay sided with NASCAR because they feel the sanctioning body may ultimately emerge vindicated when the trial comes to an end.

And that means what? Once again, money – or in this case, the potential of even more money and the value of charters.

But there’s one significant caveat about charters that many fans either find confusing or may not even be aware of at all: technically, individual charters are not truly owned by the teams, but rather are owned by NASCAR. In other words, charters are not like franchises in other professional sports entities. Charters are designed more so to give teams a value of what each team is worth, particularly in light of a future sale of a team or its existing charter.

For example, because some of the premier team charters, such as those held by Hendrick Motorsports, Joe Gibbs Racing, or Team Penske, are much more successful both on-track and in business/sponsorship operations, they theoretically are worth more than charters owned by smaller teams such as 23XI and FRM.

That’s another of the key points that 23XI and FRM are contesting. If the charter system were scrapped in favor of a true franchise system like those seen in other professional sports, all teams in theory would have a more equitable – and more valuable – individual entity.

What happens from here?

As contentious and convoluted as all the pretrial hearings, depositions, and even the inadmissible texts/emails have been, that’s nothing when it comes to who will get what depending on which side ultimately wins.

Perhaps the biggest fear of all is for the two teams: if they lose on all or most of their counts, it’s likely they will both go out of business and will not race in 2026. In other words, if they are unable to retain their charters, it would not be financially prudent to try and continue competing in the sport, given the even greater financial loss they’d suffer from without the protection of a charter.

However, if by some miracle the two teams emerge victorious – or even semi-victorious – they would be entitled to financial damages or to keep their charters. But that becomes an either/or situation: if the teams are awarded financial damages, they likely will not retain their charters. But if they choose to retain the charters, they likely will not receive any financial damages (plus have a hefty legal bill they will have to foot to pay their lawyers).

If NASCAR wins, for all intents and purposes, it will continue with business as usual, although it would not be a complete surprise if the trial prompts team owners who are currently backing NASCAR’s side to seek changes in the charter system, increased revenue disbursement, and greater involvement by owners in sanctioning body decisions.

One thing that will likely not happen in any way shape or form is if 23XI/FRM wins, the decision would not force NASCAR to be broken up or even sold. In essence, everything would continue on for both sides.

Who wins and who loses?

Both sides have strong cases, but in the end, NASCAR has its 77-year history and a business model that has remained fairly consistent over all those years. Their contention would appear to be akin to “if it ain’t broke, don’t fix it.”

On the other hand, 23XI/FRM are attempting to fight the good fight, standing up for smaller teams to give them a greater seat at the NASCAR table and to equalize the disparity of value between big vs. small teams.

And what about NASCAR fans? How will the trial outcome impact them? Honestly, it likely won’t. This is all about money and power between NASCAR and its teams.

However, if Jordan takes his ball and goes home with it and folds 23XI in the process, that could ultimately be the biggest loss of all. NASCAR needs Jordan more than Jordan needs NASCAR. There has never been a larger, more globally renowned team owner in the sport’s history. If he were to stay in the sport, it would be a win-win for NASCAR, his team and especially the fans, particularly with NASCAR Commissioner Steve Phelps and President Steve O’Donnell’s commitment to grow the sport and attract more fans of color or nationality.

But if NASCAR wins the battle and loses Jordan in the process, if he wants to remain in some form of racing, Jordan could always look to IndyCar, Formula One – or maybe even follow the lead of another NASCAR legend, Tony Stewart, who has also become disenchanted with NASCAR – and take his billions with him to NHRA drag racing.

Or maybe even start his own racing series. He certainly could afford it.