23XI Racing and Front Row Motorsports Seek $360 Million from NASCAR in Antitrust Lawsuit
In a pivotal development in the antitrust case against NASCAR, economic expert Edward Snyder testified that 23XI Racing and Front Row Motorsports are entitled to over $360 million in damages. This figure breaks down to $215.8 million for 23XI and $148.9 million for Front Row, reflecting lost profits, diminished market value, and projected revenues for the 2025 season.
Snyder, a respected economist with a Ph.D., outlined his methodology during a nearly five-hour examination this week. His analysis, based on extensive financial documents, valuation data, and NASCAR’s operational practices, indicated systematic anti-competitive behavior by NASCAR. The teams allege that NASCAR protects its monopoly through exclusivity clauses that limit competition.
Snyder elaborated on several key points during his testimony:
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Barriers to Entry: He claimed NASCAR has fostered barriers since 2015, inhibiting new competitors from acquiring venues, teams, or vehicles. He emphasized that Cup Series teams are compensated below competitive market rates.
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Market Comparisons: In comparing NASCAR to other sports leagues, Snyder noted that unlike these leagues, NASCAR lacks entry points for competition. For instance, the PGA Tour and Formula 1 have adjusted financial terms in response to emerging competitors. Snyder pointed out that NASCAR’s response has been to implement more exclusivity.
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Financial Dynamics: He highlighted that NASCAR’s 2024 net payments to racetracks totaled $311 million, which he attributed to a strategy of paying tracks within exclusivity frameworks. Snyder also posited that the average revenue share for NASCAR teams was 25% compared to 45% for Formula 1 teams during the same period.
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Team Turnover: Snyder reported a significant churn in the Cup Series, with 11 of the original 19 teams from the 2016 charter agreement exiting by 2025. He cited Furniture Row Racing’s departure after winning the championship as a case study.
The testimony faced critical examination from NASCAR’s counsel, Lawrence Buterman, who argued that Snyder’s conclusions were largely theoretical and lacked concrete evidence of imminent competition. Furthermore, NASCAR countered that exclusivity clauses are comparable to non-compete agreements within other sports leagues.
The case centers on claims that NASCAR’s anti-competitive practices have unfairly disadvantaged 23XI Racing and Front Row Motorsports—both teams opted out of signing the 2025 charter agreement. The legal proceedings continue to underscore tensions within the NASCAR framework as teams navigate competitive and financial challenges.
