Two prominent racing teams, one co-owned by a legendary sports icon, have taken a bold step by filing a federal antitrust lawsuit against the governing body of their sport and its chairman. The lawsuit alleges that the current system unfairly restricts competition, binding teams to the governing body, its tracks, and its suppliers.
The two teams, 23XI Racing and Front Row Motorsports, claim that the governing body’s “monopolistic bullying” has created an unfair environment, hurting teams, drivers, sponsors, and fans alike. They argue that the current charter system, introduced in 2016, has led to a lack of competitiveness and has driven several teams out of business.
The teams are seeking details about the governing body’s exclusionary practices and intent to insulate itself from competition. They are also seeking treble damages for anticompetitive terms that have governed the sport since the initial charter agreement.
The lawsuit claims that the governing body’s revenue-sharing model is unfair and has led to a situation where teams are unable to turn a profit. One team owner, Bob Jenkins, has stated that he has never turned a profit since forming his team in 2005, despite winning a major race in 2021.
The teams are demanding a more competitive and fair system, where teams, drivers, and sponsors can be rewarded for their investment. They want a greater share of revenue, a voice in governance and rulemaking, and a cut from deals earned by the governing body.
The lawsuit alleges that the governing body presented teams with a take-it-or-leave-it offer, threatening to discontinue the charter system if a substantial number of teams did not agree. This, the teams claim, led to a situation where most teams felt coerced into signing the agreement.
The lawsuit marks a significant turning point in the sport, with the two teams taking a stand against the governing body’s alleged monopolistic practices. As the litigation proceeds, the outcome could have far-reaching implications for the sport and its stakeholders.
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