Times are changing in NASCAR after a lawsuit is filed

In 1964, Bob Dylan released a song called Times that are changing. 60 years later, this timeless work of art serves as a powerful theme song about the current state of the National Association of Stock Car Racing (NASCAR).

For over 75 years, the sport was ruled by the iron fist of the French family, and despite minor breakdowns over the years in the face of challenges to the machines in the form of an attempt to form a drivers’ union in the 1960s. In 2014, at Team Alliance, the French family reigned supreme, with the few obstacles along the way. Now the family faces its biggest challenge yet in the form of an antitrust lawsuit filed by two racing teams that make up the sanctioning body’s premier racing series, the NASCAR Cup Series.

On Wednesday morning, 23XI Racing, co-owned by NBA legend Michael Jordan, NASCAR Cup Series competitor Denny Hamlin and businessman Curtis Polk, along with Front Row Motorsports, a team owned by businessman Bob Jenkins, formally filed a federal antitrust lawsuit against NASCAR in the Western District of the Carolinas North.

Sure, a large part of the lawsuit concerns the NASCAR charter agreement, a document that every NASCAR Cup Series team except 23XI and Front Row signed allegedly under duress from NASCAR under threat of having their charters revoked. But 23XI’s Polk says the lawsuit is about much more than just the statutes.

During Wednesday’s news conference, Jeffrey Kessler, a legendary antitrust lawyer employed by the teams, pulled back the curtain by trying to explain in more detail the decision to sue NASCAR.

“I have spent most of my career litigating antitrust cases across a variety of professional sports, trying to create a fairer, more favorable and more innovative system for those sports that will benefit all stakeholders in those sports. “I’ve never had a situation where we found it as blatantly anti-competitive as this,” Kessler said. “What we have here is a sport where one family has essentially used its power to create an absolute monopoly for the benefit of that family and not for the benefit of the teams, drivers, sponsors, broadcasters and fans.”

Over the years, Kessler has fought antitrust lawsuits against the NFL, NBA and NCAA, among others. The man claims that none of the cases looked more scandalous than the one he will soon face in the world of NASCAR. This alone says a lot and should, honestly, be the biggest warning sign for potential legal action.

Kessler reiterated that the monopoly obtained by the France family was not due to any significant ownership move by the family. Kessler says the family spent years simply writing a check to eliminate all competitors, and in recent years has made increasing efforts to keep teams in the NASCAR Cup Series from drifting away from NASCAR.

“This monopoly was not created because of a superior product, family investment or innovation. This monopoly was created because of illegal monopolistic practices,” Kessler explained in detail. “When a competitor came along, it was taken over. If tracks existed that would have allowed the creation of another competitor, those tracks had been acquired or were subject to agreements that prevented them from being made available to another competitor. When teams tried to think about creating their own track to create competition, teams were placed under restrictive contracts to prevent them from doing so. They were then told that their cars would be the ones that teams would build and pay for them, but that NASCAR would control them, so they couldn’t use them even in a competitive league.

Monopolistic practices by NASCAR and the French family led racing teams through the Race Team Alliance to seek Kessler’s advice during recent charter negotiations that dragged on for several years with no end in sight. That is, until all but two teams magically decided to end the fight and sign the agreement on Friday, September 6. According to Kessler, NASCAR’s scare tactics that forced most of the racing teams to sign on are what led 23XI Racing and Front Row Motorsports to finally say enough is enough.

“The final straw for these two teams came when NASCAR, as a final example, a classic example of monopoly abuse, went to the teams on September 6 and at 5 p.m. said, ‘This is your deal. You either take it or “we won’t have any charters at all,” Kessler explained. “Most teams that invest their livelihoods in this have been unable to withstand this monopolistic pressure and have concluded that they will simply have to make a deal.

“Those two teams weren’t going to take it. In most professional sports, and in college sports as well, if you’re familiar with the situation, there comes a point where there’s a watershed moment where the sport either has to voluntarily restructure and adapt to new conditions. change and create a fair competition system, otherwise the courts will force them to do so. That’s where we are when it comes to stock car racing in the United States.

Kessler said neither 23XI Racing nor Front Row Motorsports wanted this to result in an antitrust lawsuit, but after several years of fighting and then a pressure-filled ultimatum, they were left with no choice. This is a fork in the road moment for NASCAR, and Kessler feels that no matter what happens, the sport will improve for the benefit of all parties involved.

“Both of my clients wished they had never had to experience this moment. They wanted NASCAR to be a good partner. They wanted to find a way to do a voluntary restructuring so that the teams actually had a fair chance to get a return on what they invested in the sport. NASCAR was not willing to engage in these types of discussions. Instead, we filed this case. We expect to win this case and either way stock car racing will change for the better for this country,” Kessler said confidently.

Kessler realizes there will be challenges along the way because this business is different from those he has tried in the past because NASCAR is owned by one family at the top. But while some of the factors are different, the bottom line is the same – the sports league is afraid of competition and has done everything in its power to be the lone player in the industry.

“(NASCAR’s) defense is that if competition comes into this industry and fans run away, this sport will die and we will never enjoy it again. History shows quite the opposite. “Fans love it whenever competition is introduced,” Kessler said. “There is a more equitable distribution of resources, more investment is being made and progress is being made in the sport. So in that sense it’s very similar. The difference, as you point out, is that in no other major sport has a single family run the sport as their own pay stub and piggy bank in the same way that NASCAR is run.

“We’ll see what effect it has on the way they try to defend. We will see what impact this will have on whether this case can be resolved or whether we will have to take it to trial. Or In this way, we are willing to do whatever it takes to make change.”

Because NASCAR is a private sports league, the teams and Kessler don’t have much to say in terms of specific information that allows us to see how one-sided the sport’s revenue distribution has been over the years. But Kessler says they will learn much more about NASCAR’s finances through findings in the antitrust trial.

“We know what we know from public information. We will learn much more from the discoveries,” Kessler explained. “That’s one of the advantages of federal antitrust prosecutions. We will be able to obtain financial data. We will be able to track the money. We will be able to see exactly how exploitative this system was and what damage it caused to teams and drivers. Because when teams have no money, it also directly kills the drivers, but it is the teams that pay the drivers compensation. So this is a direct attack on both. why they were interested, the reason they love the sport is because of the teams and drivers, not the French family.

While Kessler wouldn’t elaborate on what he expects from teams in this situation, he said the goal is to create a system in which teams, drivers and all stakeholders of the sport receive a fair share. Kessler says this hasn’t happened so far, and if someone wants to defend themselves, they can respond, “Well, if it’s so unfair, why did all the other teams sign the deal?” Kessler, who has been involved in more such cases than anyone else in the world, says that in such situations, the victims, in this case the racing teams, take whatever they can get because, in the end, it’s better than nothing. But just because people sign on the dotted line doesn’t mean the deal is a win-win for everyone involved.

“In every antitrust case, victims take what they can get. Players who missed free agency would agree to contracts. That didn’t mean they wouldn’t play, whether they were paid fairly or not. Or if they have a discrimination case and women or minority employees are not being paid fairly, they will accept that deal rather than not work, but sometimes there have to be those who have the courage, resources and willingness to stand up and say it. “We won’t take this anymore.” And this will benefit all of them. So no, it doesn’t surprise me that many victims will continue to be victims until this wrong is righted,” Kessler noted.

As Dylan sang, “The line that was drawn. The curse that was cast. The jester now will be quick later. Just like the present, later it will pass. Order quickly disappears. And now they are the first, later they will be the last, because times are changing.”

Times are changing, OK. Grab your popcorn, people. The situation that seemed almost over and set in stone is only just beginning.