23XI and FRM DROPPING Preliminary Injunction Appeal

What’s Happening?

23XI Racing and Front Row Motorsports are dropping their appeal to the Nov. 8 preliminary injunction ruling. This ruling denied the two teams a preliminary injunction to compete as chartered teams throughout their Oct. 2 antitrust lawsuit with NASCAR.

@brakehard 23XI RACING AND FRONT ROW MOTORSPORTS DROP THEIR APPEAL #nascar #racing #motorsport ♬ original sound – brakehard

• On Nov. 12, 23XI/FRM filed a Notice of Appeal for the Nov. 8 ruling. However, almost a week later, the teams pulled their appeal, citing ever-changing circumstances. “Circumstances have changed in the underlying case, removing the need for this appeal and necessitating Appellants to seek new relief from the district court.” These circumstances are unknown, and neither are what the teams will do next.
• Dropping this appeal could imply several likely roads as the next route for the teams. In the initial ruling, the judges stated the two teams could file a renewed motion “should circumstances change.” This similar wording to Wednesday’s filing suggests that these circumstances have perhaps changed, and this move will lead to the teams filing a renewed motion.
• In the initial ruling, the judge stated, “Plaintiffs have alleged only a potential loss of goodwill, contingent on a host of events occurring, including speculation about how third parties may or may not act.” This refers to the teams’s lawyer’s attempt to prove irreparable harm from racing as “open” teams in 2025.

Background

• The teams attempted to prove irreparable harm by claiming that sponsors and drivers, like Tyler Reddick, could leave the team if they were unchartered. The judges felt this claim, amongst others, was speculatory. Perhaps circumstances have changed, and the teams are now better able to prove irreparable harm.
• If the teams reverse course and get their injunction, they will race as chartered teams in 2025. The point of this injunction is that the teams could not file their broader antitrust suit against NASCAR without the removal of the release clause in the NASCAR Charter Agreement, exonerating NASCAR from any antitrust litigation from teams.
• These teams will need their charters to gain revenue sharing with NASCAR. However, two new charters from SHR are on the line. Wednesday, 23XI Racing announced they were opening a third team, Riley Herbst’s No. 35. This implies they will go forward with this expansion with or without a charter. There is no recent news on FRM’s expansion plans. Both teams will race in 2025.
• We have covered this lawsuit extensively, and the timeline is linked below.

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