CHARLOTTE, N.C. — An economist testified in Michael Jordan’s federal antitrust trial against NASCAR that the racing series owes a total of $364.7 million in damages to the two teams suing it over a revenue-sharing dispute.
Edward Snyder, an economics professor who worked in the Justice Department’s antitrust division and has testified in more than 30 cases, including “Deflategate” involving the NFL’s New England Patriots, testified Monday. He gave three specific reasons why NASCAR is a monopoly participating in anticompetitive business practices.
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Using a complex formula applied to 23XI Racing and Front Row Motorsports’ profits, reduced market revenue and lost revenue from 2021 to 2024, Snyder calculated the amount of damages owed. Snyder applied in his calculations a 45% revenue share that he claims Formula 1 gives to its teams; Snyder found that NASCAR’s revenue sharing model, when its charter system began in 2016, gave only 25% to teams.
The lawsuit concerns the 2025 charter agreement, which was presented to teams on a Friday in September 2024 with a same-day deadline to sign the 112-page document. The lease offer came after more than two years of tough negotiations between NASCAR and its teams, who called the deal a “take it or leave it ultimatum” that they signed with “a gun to their head.”
A charter is similar to the franchise model in other sports, but in NASCAR it guarantees 36 teams in a 40-car field, as well as specific revenue.
Jordan and Denny Hamlin, a three-time Daytona 500 winner for 23XI, along with Front Row Motorsports and its owner Bob Jenkins, were the only two teams out of 15 to decline the new lease deal.
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Snyder’s assessments found that NASCAR was actually violating antitrust laws to the extent that the private racing series controls all negotiations because “teams have nowhere else to sell their services.” Snyder said NASCAR controls “the tracks, the teams and the cars.”
Snyder repeatedly cited the exclusivity agreements NASCAR made with racetracks after the charter system began. The agreements prevent tracks that host NASCAR from holding events with rival racing series. Prior to long-term agreements, NASCAR operated one-year contracts with its host racetracks.
The Florida-based French family founded NASCAR in 1948 and, along with Speedway Motorsports, owns nearly every track on the top Cup Series schedule. Snyder’s belief is that NASCAR has entered into exclusivity deals with tracks to ward off any threat from a series of breakaway startups. In doing so, he said it eliminated the ability for teams to race stock cars elsewhere, forced them to accept revenue-sharing deals below market value and hurt their overall valuations.
Snyder did his calculations for both teams based on the fact that each had two charters – each purchased a third charter in late 2024 – and found that 23XI owed $215.8 million while Front Row owed $148.9 million. Based on his calculations, Snyder determined that NASCAR shortchanged 36 licensed teams for $1.06 billion between 2021 and 2024.
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Snyder noted that NASCAR has $2.2 billion in assets, a net worth of $5 billion and an investment-grade credit rating — which Snyder said positions the French family to be able to pivot and adapt to any threat from a rival series like the PGA did in response to the LIV golf league. The PGA, Snyder said, “got creative” in generating new revenue to pay to its golfers to prevent their defections.
Snyder also testified that NASCAR made an annual profit of $250 million between 2021 and 2024 and that the France family received $400 million in distributions during that period.
NASCAR says Snyder’s estimates are wrong, that the 45% F1 model he used is not correct, and its two experts “seriously dispute” Snyder’s conclusions. Defense attorney Lawrence Buterman asked Snyder for his opinion on NASCAR’s upcoming expert witnesses and Snyder said they were two of the best economists in the world.
Snyder testified for most of Monday’s session – the sixth day of the trial – and will continue on Tuesday. The snail’s pace agitated U.S. District Judge Kenneth Bell, who heard arguments 30 minutes early Monday morning because he was annoyed that objections were submitted at 2:55 a.m. and then at 6:50 a.m.
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It took him an hour to read the decisions and testimony resumed 30 minutes late. At the end of the day, he asked the nine jurors if they were willing to serve an extra hour each day the rest of the week to avoid a third full week of trial. He all stated that all motions had to be filed by 10 p.m. each evening.
Bell wants plaintiff’s attorney Jeffrey Kessler to wrap up his case by the end of Tuesday, but Kessler told him he still plans to call NASCAR Chairman Jim France, NASCAR Commissioner Steve Phelps and Hall of Fame team owner Richard Childress, who has been the subject of derogatory text messages among NASCAR executives and has said he is considering legal action.
NASCAR has a list of 16 potential witnesses and Bell said he wants the first one on the stand before the end of Tuesday’s session.
