NASCAR charter teams would get extra $1.5M if 23XI, FRM denied injunction

At some point this week, the judge overseeing the 23XI Racing and Front Row Motorsports v NASCAR antitrust lawsuit will issue a decision that will determine if those two organizations will be recognized as charter holders for the rest of the season.

In a letter issued to the teams that signed the agreement last year, NASCAR commissioner Steve Phelps says the outcome could decide up to an additional $1.5 million per charter should 23XI and Front Row have their injunction motion denied.

The teams want federal district judge Kenneth D. Bell to issue an order that would force NASCAR to recognize them as if they held three charters respectively — which means paying them as if they were.

It’s a similar order to the one Bell issued in December but was ultimately overturned by the Fourth Circuit of Appeals back in June. That decision meant NASCAR was no longer required to issue charter payments to 23XI and Front Row. It also meant NASCAR was no longer obligated to acknowledge those two teams purchasing one charter each from the now shuttered Stewart-Haas Racing.

In response to the Appeals Court decision, 23XI and Front Row filed a new injunction motion with the district court under the guise of new evidence found during the fact discovery process.

During this period, NASCAR has also moved towards transferring those charters to new teams for 2026, which is also something the new injunction asks the judge to prevent NASCAR from doing.

Anyway, in a letter sent to the 13 teams that did sign the charter extension agreement last year, Phelps wants them to know what is in it for them should the judge rule in favor of NASCAR.

The details of this letter were first published by the Charlotte Observer on Tuesday but independently obtained by Motorsport.com. NASCAR told these teams that it had paid $25,146,300 in fixed charter payments to 23XI and Front Row from February to June due to the December injunction order.

Phelps wrote that if the court orders 23XI and Front Row to return that money, that it will pay $832,210 on average per Charter to active Charter holders. The math there is the $832,210 times 30 to each current charter holding entry.

“If the Court grants Plaintiffs’ motion, NASCAR will likely be required to pay Plaintiffs as if they were Charter holders (either for the period they raced open through the remainder of the season (Dover through Phoenix) or from the date of the Court’s order through the remainder of the season (possibly as early as Darlington through Phoenix) If, on the other hand, the Court denies Plaintiffs’ motion, NASCAR intends to pay the funds that would have been paid to those cars in Fixed Owner’s Payments and Performance Payments to the remaining active 2025 Charter holders. If Plaintiffs’ motion is denied, NASCAR estimates that the total per Charter payments would be approximately $670,000 on average per Charter.”

The short version of this is that NASCAR pays the 13 actual charter organizations more of the agreed upon revenue pool if they are not having to split it with six entries across two teams that did not sign the agreement but still want to be included in the system through the duration of the litigation.

The judge will rule on that plus NASCAR’s ability to transfer the charters previously officially held by 23XI and Front Row in light of the Sanctioning Body stating that it would create up to four more charters and issue those instead should they lose in trial.

However, charters 1-36 have more value than the currently non-existent charters 37-40, which is why both new teams and 23XI/Front Tow would covet those more.

Phelps also said that some charter teams would like to communicate with the court their interest in this money and the letter stated that ‘NASCAR does not object.’

As for how 23XI and Front Row feel about the letter?

“My clients are aware of the letter and its contents,” said 23XI Racing and Front Row Motorsports attorney Jeffrey Kessler in a statement. “This letter is yet another tactic by NASCAR to divide the teams and distract from the facts of their monopolistic practices.

“23XI and Front Row Motorsports are pursuing this lawsuit to change the sport of NASCAR for the benefit of all drivers, fans, sponsors and teams, and believe the teams have much more to gain in the long run by growing the sport for everyone.”