23XI statement on not signing Charter agreement

wi_racefan said:
To me this whole thing is the equivalent of demanding a raise because your employer made money last year. So if nascar shows a loss one year will Dennis write a check to help cover their losses?

People fail to realize what operating costs of a company are. Tracks cost a lot money to run to only see one or two times a year of income.

I see this all the time at work. People think that I get paid a ton because of how much an hour we charge hourly for me to be onsite. Turns out there's a whole lot of things that have to get paid out of that money, including my salary.

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NASCAR teams have operating expenses as well. I think it is also common knowledge that drivers earn less of a salary than they were previously paid. That's a good indicator of tighter operating budgets for most everyone, in my opinion.

All the while, NASCAR is more of a closed (just trust me) book. I think the assumption is that stock car racing stops without NASCAR and that the teams are expendable. I just don't buy into that, at least when the teams are considered collectively, and they also essential imo. Especially when NASCAR is the one playing hardball.
 
I just can't see Nascar wanting to open their books for everybody to see with a lawsuit. Time will tell.
 
Charlie Spencer said:
I'm sorry, what gambling revenue? I don't gamble or follow the industry. I didn't know NASCAR had a gambling revenue source.

Thanks.
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@rd45usa , @aunty dive , so NASCAR isn't directly involved in the gambling but gets paid by the gambling companies to use its name, like any other 'official partner' relationship or at-track vendor? I read both articles but I'm not clear on how NASCAR is making money from someone else's gambling operations, or whether there's enough involved for it to be significant in charter negotiations. This doesn't sound like money on the level of the four Cup series sponsors.
 
aunty dive said:
Uncertainty of charter values going forward … some teams, including 23X1 and FRM paid tens of millions for what they thought would remain as appreciating assets?

Sports gambling revenue split?

NASCAR’s speculative desire to charter / operate teams of its own? Flies directly in the face of antitrust law.

I think it’s a mistake to underestimate this group of people.
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Regarding buying a charter, the teams clearly knew the conditions of the charter agreement when purchased. That's business, risk, and speculation. Every day businesses buy what the think would be an appreciating asset but it fails to materialize.
Sports gambling...I am not understanding where you are going with this in regards to the charters and I don't see any definitive abuse of antitrust laws
Dwayne said:
If I'm a team owner and one of my teams is in 12th and doesn't make the playoffs while a team in 34th does....
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I don't understand your point here???
 
DIDIT said:
Regarding buying a charter, the teams clearly knew the conditions of the charter agreement when purchased. That's business, risk, and speculation. Every day businesses buy what the think would be an appreciating asset but it fails to materialize.
Sports gambling...I am not understanding where you are going with this in regards to the charters and I don't see any definitive abuse of antitrust laws

I don't understand your point here???
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Neither do I. Racing teams are free to go race in any series they choose. The charters actually help if teams choose to leave Nascar.
 
DIDIT said:
I don't understand your point here???
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His point is that 34th-place Burton was in the playoffs while 23XI's 12th-place Wallace will wind up no better than 17th for the season; and that may be another reason the team hasn't signed.

EDIT - I don't see the outcome of any potential lawsuit resulting in a change to the competition rules.
 
DIDIT said:
Regarding buying a charter, the teams clearly knew the conditions of the charter agreement when purchased. That's business, risk, and speculation. Every day businesses buy what the think would be an appreciating asset but it fails to materialize.
Sports gambling...I am not understanding where you are going with this in regards to the charters and I don't see any definitive abuse of antitrust laws
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It’s so easy to be misunderstood here.

Are the charters balance sheet assets or are they operating statement expenses whose cost is spread out over the time remaining on the agreements? Corporate income taxes payable are very different in each case. Obviously, the 2 outliers are in the former camp and may attempt to prove that by legal / accounting means. I have no way to know whether or not they’d be successful and take no position either way. Not enough information.

I haven’t suggested that any potential sports betting revenue splits have anything to do with the anti-trust issues involving the charters. Apparently other revenue sharing disagreements have been resolved. I brought it up simply because Chris Polk mentioned it as an unresolved issue during an interview I read about.

He also said: “We will continue to race. We have the resources.” I need some new kicks. I think I’ll go to the Nike Store. 😇
 
aunty dive said:
I haven’t suggested that any potential sports betting revenue splits have anything to do with the anti-trust issues involving the charters.
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Thanks. If there isn't any documented issue, I'll quit wondering how it works.
aunty dive said:
I think I’ll go to the Nike Store.
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Let us know if you bump into @Revman doing his part to support one of HIS Yoyos.
 
Charlie Spencer said:
Thanks. If there isn't any documented issue, I'll quit wondering how it works.

Let us know if you bump into @Revman doing his part to support one of HIS Yoyos.
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He's probably out crash studying for the BAR right now before the end of the season to try to keep them there. 🤪 :D :XXROFL:
 
From the CNBC website article:

“23XI Racing and Front Row Motorsports said they will seek discovery from both NASCAR and France, and will seek damages for the anticompetitive terms they said they have been subject to under the 2016 charter agreement.

The teams are being represented by one of the most prominent sports lawyers in the country, Jeffrey Kessler, co-executive chairman of Winston & Strawn.

Kessler said they will file a preliminary injunction to enable the teams to race in the next calendar year while continuing to pursue antitrust litigation.

NASCAR did not immediately respond to a request for comment on the suit.”
 
Charlie Spencer said:
If they're going to court, I don't know what they'd be waiting on. Cases involving sports sanctioning bodies move slower than John Hunter with a flat and seven cylinders. Sign or file but get a move on; I don't see how delaying is giving those two teams any advantage.
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Two weeks later...
 
Whiskyb said:
Things heating up, personally think nascar has its bases covered. Nobody is forced to participate
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You have about 100 times more faith in NASCAR management than I do. Whether NASCAR likes it or not, once they signed on to the charter agreement, and ESPECIALLY after people PAID substantial money for them, then they have obligations to those charter holders that didn't previously exist. I have serious gripes with BOTH sides in this argument, but I think NASCAR is on pretty Shakey ground here. If nothing else, regardless of the outcome of the legal proceedings, hopefully it will clarify the situation going forward and EVERYONE will know where they stand and what is expected of them.
 
Hamlin..victim. "I didn't realize"

Hamlin has been a Cup Series driver for Joe Gibbs Racing since 2005. Alongside friend and NBA great Michael Jordan, he founded 23XI Racing in 2021.

“I didn’t realize until re-investing the money that I’ve made as a driver back into the sport to put on a show for Jim France and NASCAR, how unfair this whole system is,” Hamlin said. “I didn’t realize they would exercise the power that they did in an unfair manner, in my opinion, and we just got to a tipping point where we all said, enough is enough and let’s exercise some options.”
 
I believe this lawsuit was the objective of Jordan, Hambone and some others all along. They wanted all the teams to refuse to sign and join the suit. When they and Jenkins were left standing alone, they had to make a decision. Obviously they won’t be signing the agreement.

This is a huge challenge to NASCAR and the equilibrium we’ve had for quite a while. Antitrust litigation takes a LONG time to adjudicate. Key could be which judge gets assigned to the case. A very BIG early test will be related to the injunction request, seeking to allow both teams to race next season until the case is settled. NASCAR contracts require teams to not place lawsuits against the organization. Violations can include exclusion from participation in racing activities. I would expect that injunction to be granted, BUT if the judge finds that the contract is valid, both teams could be locked out of next season until the decision or settlement is completed.
 
Kiante said:
The same lawyer that helped the NIL come to fruition?

Hooo boy.
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In my opinion, the NIL is quickly leading to the death of college sports as we know them, and I think the same is also possible with the charter system of NASCAR, but in both cases, the Pandora's box has been opened, and it's going to be next to impossible to get the lid closed now.
 
Conover said:
I believe this lawsuit was the objective of Jordan, Hambone and some others all along. They wanted all the teams to refuse to sign and join the suit. When they and Jenkins were left standing alone, they had to make a decision. Obviously they won’t be signing the agreement.
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Considering the 23XI expanded, built a very large expensive shop and now say they didn't like the porridge? I agree, looks like a setup. They thought they would get everybody to play along.
 
Formerjackman said:
In my opinion, the NIL is quickly leading to the death of college sports as we know them, and I think the same is also possible with the charter system of NASCAR, but in both cases, the Pandora's box has been opened, and it's going to be next to impossible to get the lid closed now.
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Nah, kids were being exploited for far too long. It's not the death of anything, let those make a some money while in college. One injury could stop it all for them.

College is expensive as hell anyways and not everyone makes it to the pros and not everyone gets these NIL deals.
 
Formerjackman said:
In my opinion, the NIL is quickly leading to the death of college sports as we know them, and I think the same is also possible with the charter system of NASCAR, but in both cases, the Pandora's box has been opened, and it's going to be next to impossible to get the lid closed now.
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The NIL deal is the result of the NCAA choosing to operate in an illegal cartel fashion for decades because of greed. They could have done something different that would have prevented the massive changes college sports are seeing, but opted not to because $$$. That's all that needs be said in response to this IMO.
 
virtualbalboa said:
The NIL deal is the result of the NCAA choosing to operate in an illegal cartel fashion for decades because of greed. They could have done something different that would have prevented the massive changes college sports are seeing, but opted not to because $$$. That's all that needs be said in response to this IMO.
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Sometimes doing the right thing doesn't turn out like we hope. Giving the athletes what they deserve may kill the very system that gives it to them. The same may be able to be said about the NASCAR charters.
 
Formerjackman said:
Sometimes doing the right thing doesn't turn out like we hope. Giving the athletes what they deserve may kill the very system that gives it to them. The same may be able to be said about the NASCAR charters.
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Well, if giving the athletes what they're owed makes college sports fall apart, what does that say about college sports in the first place? Sure suggests to me that it shouldn't have existed in the first place because it could only exist in an environment where the athletes had no rights and were dependent on under the table payoffs to get by. Lots of things came and went because it turned out they actually were exploitation.
 
virtualbalboa said:
Well, if giving the athletes what they're owed makes college sports fall apart, what does that say about college sports in the first place? Sure suggests to me that it shouldn't have existed in the first place because it could only exist in an environment where the athletes had no rights and were dependent on under the table payoffs to get by. Lots of things came and went because it turned out they actually were exploitation.
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Some of us have considered the whole stick and ball thing exploitation for years. Most pro ballers are broke within 5 years of retirement. Many crippled for life. Judging by how many Nascar types continue to be successful after they hang up the helmets is another reason to once again state stick and ball and racing are two different things. Most comparisons are useless.
Right now Biffle, Carl Edwards, JGR, Hendrick are flying their helicopters to help flood victims in need. Any stick and ballers doing the same?
 
StandOnIt said:
Some of us have considered the whole stick and ball thing exploitation for years. Most pro ballers are broke within 5 years of retirement. Many crippled for life. Judging by how many Nascar types continue to be successful after they hang up the helmets is another reason to once again state stick and ball and racing are two different things. Most comparisons are useless.
Right now Biffle, Carl Edwards, JGR, Hendrick are flying their helicopters to help flood victims in need. Any stick and ballers doing the same?
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Most stick and ballers don't have a helicopter. They don't need one. They take a team plane places.
 
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