NASCAR to file appeal of injunction ruling; asking for emergency partial stay and bond
Today at 07:53 PM
NASCAR will file an appeal of the preliminary injunction that was granted to 23XI Racing and Front Row Motorsports.
But in addition to the appeal, NASCAR has filed additional motions pertaining to the injunction. The first is asking for an emergency motion for partial stay of injunction pending the appeal. The second is for the teams to post an injunction bond.
In asking for the stay pending appeal, NASCAR claimed they "are likely to succeed on appeal" and "suffer irreparable harm without a stay of the Court's decision," while the teams "would not face substantial harm because the continued enforcement of a partial stay would address each of Plaintiffs' irreparable harm allegations," and lastly, "the public interest supports a partial stay, as this Court's preliminary injunction forces NASCAR into unwanted contractual relationship with Plaintiffs."
23XI Racing and Front Row Motorsports were granted the preliminary injunction to race as charter teams Dec. 18 while stating the release clause is not enforceable. The ruling also said NASCAR could not deny the purchase of a charter for each team from Stewart-Haas Racing, which would be used for the third team each organization is adding.
In addressing the belief that they are likely to succeed on appeal, NASCAR states that it was never given a chance to offer the issues around those purchases and the teams never included the issues in their complaint. NASCAR also states that letting the teams field their two cars without the release clause contradicts Fourth Circuit precedent.
"And this Court's conclusion that the Charter's release provision is likely unlawful stems from a misunderstanding of that provision, which does not operate prospectively – as confirmed by Plaintiffs' counsel. Numerous cases confirm that retrospective releases of antitrust claims do not, by themselves, constitute Sherman Act violations."
The claim of how NASCAR will suffer irreparable harm is connected to having to approve the charter sales between the teams and Stewart-Haas Racing. By doing this, it will not be limited to only the 2025 season, as the preliminary injunction is. If the two sides do not come to a resolution on the lawsuit, the trial will be held before the 2026 season.
Instead, the charter sales "will effectively force NASCAR into a seven- to 14-year contractual relationship" with 23XI Racing and Front Row Motorsports. And the teams "have not met multiple required conditions for these Charters' assignment." NASCAR also argues it would be difficult, if not impossible, to undo the transfers and "entering a stay before these transfers occur is crucial to prevent the consequences of an erroneous injunction from becoming irreversible."
Additionally, by allowing the teams to race under the 2025 charter agreement would require NASCAR to disclose confidential information, which is "an action that is inherently irreparable."
A partial stay would also address the irreparable harm allegations made by 23XI Racing and Front Row Motorsports around their driver and sponsor contracts but would not force NASCAR to extend all the benefits of the charter agreement those teams refused to sign. The partial stay would also not prevent them from entering their two cars into races next year.
Lastly, this motion must be handled on an emergency basis, per NASCAR, since 23XI Racing and Front Row indicated the charter purchases with Stewart-Haas Racing must be closed by Dec. 20. And neither team intends on delaying their closing.
The motion for 23XI Racing and Front Row Motorsports to post an injunction bond is to ensure prize money (from racing as charter teams) would be reimbursed in the future if NASCAR wins the case. The amount of the bond was sealed.
