Yesterday, Michael Jordan and his 23XI Racing organization won a significant settlement in court from NASCAR. After over a week of brutal testimony & evidence disclosure, NASCAR was compelled to settle the ‘team charter’ issue in favor of 23XI Racing. It was becoming clear to the court that NASCAR has been engaging in unfair monopoly practices, thus a settlement was reached.

Charters were introduced by NASCAR in 2016 as a new revenue stream for the France family which owns NASCAR. Team owners have since been required to buy a charter, which is represented by the number on the car. These charters had expiration dates, meaning they were a perpetual rent for team owners and had to be renewed every few years. Charters were subject to arbitrary price increases and other NASCAR-governed rules & sanctions. This meant if NASCAR didn’t like an owner’s style, or whatever, teams could get jerked around and not granted a charter, or held hostage by an outrageous price increase or unfair terms.

This 23XI/NASCAR settlement establishes the legal concept that charters are equivalent to franchises in other sports, and therefore are permanent and can’t be revoked without due process. That’s the significance of this settlement.

Michael Jordan led the legal fight here, and it will be one of his most-respected achievements– which is saying something. For decades, team owners, particularly non-super teams, have been squeezed by the France family and their representatives, to the detriment of the sport. As the charter system went into effect, NASCAR signed a mega-media deal with Fox & NBC and revenue exploded. This came at time time when old stars were retiring and the next generation of drivers were coming to the fore. Kyle Larson, Ryan Blaney, Chase Elliot & Bubba Wallace were among the new drivers, as Dale Earnhardt Jr and Danica Patrick were retiring.

NASCAR introduced stage racing at that time because it was what the sponsors demanded after NASCAR got it’s mega-media deal. Dale Jr was perhaps the most beloved driver in NASCAR history, the son of a highly-controversial 7-time series champion who died at Daytona and left his legacy to his son, who was never the competitor his father was, but inherited all his glory and became NASCAR’s most popular driver. Popularity counts in racing because it’s all about attracting & maintain sponsorship. Racing costs a lot of money, and without sponsors a team is dead.

Michael Jordan wants to win, we all know that. The super-teams in NASCAR today are: Roger Penske, Joe Gibbs, and Rick Hendricks. None of these team owners liked the charter system because it added extra expense to an already costly venture. There’s an industry saying that goes, the best way to make a small fortune is to start with a large fortune and run a racing team. The only people who have been profiting from NASCAR’s revenue boom are the France family & it’s representatives, while the top teams & drivers are still scrambling to keep ahead while staying in business. Stewart-Haas racing no long exists in the NASCAR Cup Series because it was too expensive for them to compete. Michael Jordan ended up buying one of their charters to expand his 23XI team and that was part of this lawsuit which was just settled.

Tyler Reddick (#45 car), Bubba Wallace (#23 car), and Riley Herbst (#35 car) are the three NASCAR charters 23XI currently owns. Twenty-three eleven racing has Denny Hamlin as a co-owner with Michael Jordan. Hamlin still drives for Joe Gibbs in the #11 car, which explains the team name.

But it was Michael Jordan who made this happen. It took someone with his sensibility & willingness to fight against an injustice to make this happen. Many ex-drivers have started teams and then gone bankrupt, but none had the willingness to take on NASCAR. These ex-drivers & old-timers have too much reverence for NASCAR.

Michael Jordan comes from the NBA, and never tolerated disrespect or unfair bias. NASCAR has taken the historical position of disrespecting everyone outside its inner circle, and doing whatever it pleases. This meant starving teams of revenue needed to help the sport grow. When teams are going out of business and leaving the sport, this creates difficulties for drivers & crew. What is known as ‘silly season’ in NASCAR becomes an annual scramble for spots on the best teams and a fight for survival for small teams. That isn’t good for the sport, but the only thing NASCAR (AKA: the France family) cares about is maximizing revenue for itself. To be clear, MJ & his legal team just kicked NASCAR’s ass on that, and it’s about time.

It took an icon to do it. The only other icon mentioned in this article is Danica Patrick and the comparison is apt. Danica Patrick came into NASCAR at the end of her driving career, and was disrespected & mistreated by the people who run the sport, despite the fact she made them a lot of money. Danica Patrick brought a new generation of young fans into the sport and was such a big icon that NASCAR felt threatened & diminished by her presence. She had no protection from NASCAR’s abuse because she was just a driver, not a team owner.

But when an icon like Michael Jordan invests as an owner, there is no way he is going to let NASCAR disrespect him. MJ has the clout as owner of 23XI Racing. The best way I can explain this dynamic is by imagining a NBA referee who insisted on making bad calls against Michael Jordan. How long do you think that would be tolerated? First, MJ is going to be barking at the ref, all game. Then when asked about it after, he will share a few pointed thoughts. NBA commissioner David Stern (consummate businessman) would soon get involved, and who do you think he would side with– a nobody official who is out-of-line, or Michael Jordan?

It’s respect for greatness & money that drives these conclusions. Michael Jordan will not be cheated, by a crappy ref or the France family which owns NASCAR. The lesson here is that it takes an icon with clout to win against such a powerful & corrupt organization. With that said, these entities (NASCAR & 23XI) now need to make-up and learn to co-exist, and it is highly questionable whether that can happen, because there is one side (NASCAR) that always insists on cheating the rules and another that philosophically won’t allow it.

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