NASCAR lawsuit: U.S. Court of Appeals vacates injunction ruling, taking charter status from 23XI Racing, Front Row

In a ruling today, the U.S. Court of Appeals for the Fourth Circuit vacated the preliminary injunction that granted charter status to 23XI Racing and Front Row Motorsports. This will have major repercussions on the NASCAR lawsuit and season moving forward.

23XI Racing and Front Row Motorsports will not lose their charter status immediately. There is a 14-day window for the teams to ask the case to be heard by the entire panel of judges at the Court of Appeals.

The earliest this ruling will go into effect is seven (7) days after the deadline to appeal. So, we are looking at a three-week timeline for this ruling to actually go into effect at the earliest.

“In accordance with the decision of this court, the district court injunctions entered December 18, December 23, and December 26, 2024 are hereby vacated,” the court’s ruling states. “This judgment shall take effect upon issuance of this court’s mandate in accordance with Fed. R. App. P. 41.”

The ruling from Judge Niemeyer calls into question the merits of the case on antitrust grounds. Not great if you are 23XI and Front Row.

“In entering a preliminary injunctionin this case, the district court held that the plaintiffs were likely to succeed on the merits of their antitrust action against the National Association for Stock Car Auto Racing, LLC (NASCAR), and it’s CEO, James France, because NASCAR, as an alleged monopolist, required the plaintiffs, as a condition of doing business with them, to enter into a release for past conduct. Because that theory of antitrust law is not supported by any case of which we are aware, we conclude that it was not a likely basis for success on the merits and vacate the injunction.”

U.S. Court of Appeals makes major decision in NASCAR lawsuit

At the end of last year, when the injunctions were granted, 23XI and Front Row argued that the rulings would simply maintain the status quo. NASCAR felt differently, as they argued that they had adjusted the payout structure for the 2025 season to reflect a field of only 32 chartered teams, instead of 36.

The U.S. Court of Appeals had cast doubt on the legitimacy of the injunctions at an earlier hearing. 23XI and Front Row’s attorney, Jeffrey Kessler, was given a few pointed and at times intense questions from the judge.

The NASCAR lawsuit is still headed for a trial, which will take place at the beginning of December this year. It does not appear that either side wishes to settle out of court regarding this matter. NASCAR has maintained during the lawsuit that they don’t want to do business with the teams if they are not forced to by the courts.

The injunctions allowed 23XI Racing and Front Row to compete with the two charters they already had possession of in 2024. However, it also allowed them to purchase a charter each from Stewart-Haas Racing. If those charters are revoked, it could cause a mess of trouble. Not just for 23XI and FRM but for what was formerly Stewart-Haas.

NASCAR gets a big win here. It remains to be seen what will happen to the chartered teams. If they have to compete as open entries, then they will lose out on a lot of money. Jim France has to be smiling this morning. Someone check on Denny Hamlin.