NASCAR Teams Face Charter Revocation: 23XI and FRM to Compete as Open Entries
In a recent legal setback, both 23XI Racing and Front Row Motorsports (FRM) had their appeals for a temporary restraining order denied by the courts. This ruling prevents them from retaining their NASCAR charters, compelling them to participate as "open entries" starting with the race at Dover Motor Speedway this weekend. Despite this, there are currently only 37 cars entered for the event, well below the 40-car limit, suggesting that neither team is at immediate risk of being excluded from competition. The court indicated a willingness to reconsider the temporary order if the teams were indeed in danger of missing a race, citing "irreparable harm" as a potential justification.
This situation follows a prior injunction granted last December, which allowed 23XI and FRM to operate under the new 2025 Charter Agreement while simultaneously pursuing legal action against NASCAR. Their lawsuit challenged a specific release clause within the agreement and alleged anti-competitive practices by NASCAR, including monopolistic behavior. However, the Fourth Circuit Court of Appeals overturned this injunction on June 5th, and a subsequent request for a rehearing was also denied. The teams had hoped to secure a new temporary restraining order to prevent NASCAR from selling off their charters, a concern NASCAR has assured the courts will not happen before a final ruling on the injunction.
The financial ramifications of losing charter status are considerable. Without charters, teams forfeit a substantial portion of the weekly prize money. Furthermore, existing contracts with sponsors and drivers may become invalid. While "open teams" are still eligible to compete for the championship under the same regulations as chartered teams, operating without a charter typically makes a full season financially unsustainable for most. This ruling forces 23XI, which fields the No. 23 (Bubba Wallace), No. 35 (Riley Herbst), and No. 45 (Tyler Reddick) cars, and FRM, with the No. 4 (Noah Gragson), No. 34 (Todd Gilliland), and No. 38 (Zane Smith) cars, into a precarious financial position for the remainder of the season.
The recent court decision underscores the ongoing complexities and legal challenges within professional sports, particularly concerning organizational structures and the financial models that underpin them. It serves as a reminder that even established teams can face unexpected obstacles that test their resilience and adaptability. In the face of adversity, the commitment of teams and athletes to continue competing exemplifies the enduring spirit of sportsmanship and determination.