23XI Racing, which is owned by Michael Jordan and Denny Hamlin, and Front Row Motorsports filed a brief Monday morning urging U.S. District Judge Kenneth D. Bell to deny NASCAR’s motion to stay a preliminary injunction. Unless Bell is stayed or overturned on appeal to the U.S. Court of Appeals for the Fourth Circuit, the injunction will be block NASCAR to deny both teams the same terms offered to charter teams and ensure they are not forced to drop their lawsuits against NASCAR.
When he partially granted NASCAR movement For an expedited review of the requested stay last Friday, Bell asked the plaintiffs, led by attorney Jeffrey Kessler, to file a brief no later than 10 a.m. Monday. Bell said he would make a decision on NASCAR’s suspension request at some point Monday.
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The plaintiffs’ brief, signed by Kessler, escalates already acrimonious litigation in which NASCAR is accused of abusing monopsony power over racing teams while 23XI Racing and Front Row are portrayed as abusing the legal process to renegotiate a business deal which failed.
The brief describes NASCAR and co-defendant CEO Jim France as resorting to litigation scenes to hide legal loopholes.
“When a litigant has neither the law nor the facts on his side, he bangs the table,” the writ charges, adding that “the defendants’ blows have become tired, familiar and strident.” The brief argues that NASCAR “simply reaffirms – but more forcefully – the same points that this Court has already heard and rightly rejected.”
To this end, the brief criticizes NASCAR’s argument that it was not given a fair chance to address charter transfer issues related to 23XI Racing and Front Row’s plan to purchase two Stewart-Haas Racing charters. (SHR). The charters would allow the two teams to compete against each other. As the brief says, NASCAR has previously unsuccessfully made the same argument, except it now uses “elevated tone” as if it were a differentiator.
The brief also claims that when the plaintiffs’ lawsuit was filed a few months ago, neither 23XI Racing nor Front Row “had any reason to suspect” that NASCAR would block the transfers unless they contractually waived their right to continue. The brief claims that a few weeks before the trial began, NASCAR Chairman Steve Phelps “informed Front Row that his SHR transfer was approved” and that all that stood between formal approval was, as the brief puts it, the “ministerial task of submitting certain documents”. » But in December, NASCAR told Front Row it would not approve the transfer. The brief states that “the only event that occurred in the interim was the filing of this complaint by Front Row.”
The brief acknowledges that NASCAR has raised “several questions” about 23XI’s “compliance with the Team Owner and Control Person Charter requirements,” but insists those questions are pretexts. There can be no “legitimate questions” about whether the 23XI’s owners could be classified as “prohibited persons,” as the brief charges state, since Jordan and Hamlin have had charter agreements approved by NASCAR “for years “.
The brief also cites Phelps’ praise of Jordan and Hamlin as inconsistent with the idea that they might not be suitable people to own a team. Phelps was quoted as saying, “I love that Michael Jordan is in our sport. Personally, I like Michael and I think he is good for the sport. Phelps’ praise of Hamlin is also highlighted. “Denny Hamlin… does a wonderful job… I wish I had 36 Denny Hamlins.” According to the brief, “the only reason” NASCAR might consider Jordan and Hamlin “prohibited persons” is “because they asserted their antitrust rights and filed this lawsuit.” Of course, NASCAR could argue that Phelps’ opinion of Jordan and Hamlin has changed because of arguments and statements related to the lawsuit that NASCAR says are false.
If Bell grants the stay, the injunction will be set aside until the Fourth Circuit hears NASCAR’s appeal. This could take weeks or months.
If Bell refuses the stay, 23XI Racing and Front Row will have “won” in the short term since they could compete with the Charter rights and without giving up their legal claims. They could also continue their agreement with SHR.
But in this scenario, the Fourth Circuit could still reverse Bell and vacate the injunction. Even if the Fourth Circuit upholds Bell, NASCAR could ultimately win the case, which is expected to go to trial next December. Bell ruled only on an injunction, not on the merits of the plaintiffs’ broader claim that NASCAR violated antitrust law. The parties could also reach a settlement at any time.
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