Denny Hamlin's Fierce Cross-Examination Exposes Deep-Seated Tensions in NASCAR Antitrust Trial

The courtroom drama intensified on Tuesday as Denny Hamlin, co-owner of 23XI Racing and a prominent NASCAR Cup Series driver, faced a rigorous cross-examination by NASCAR’s antitrust defense attorney, Lawrence Buterman. The proceedings, part of the ongoing antitrust lawsuit filed by 23XI Racing and Front Row Motorsports against NASCAR, revealed a palpable animosity from Hamlin towards the sanctioning body, even as he maintained a veneer of legal decorum. The exchange laid bare the core disputes over the sport’s economic structure and the power dynamics between teams and NASCAR.

Hamlin repeatedly characterized NASCAR as a monopoly, a stark contrast to the plaintiffs’ assertion that their own business practices are not anticompetitive. His repeated use of "you are" when referring to NASCAR’s alleged monopolistic status was delivered with an intensity that suggested his criticisms were aimed directly at the France family, who control the sanctioning body.

One key area of contention revolved around contract exclusivity. Buterman attempted to draw parallels between the restrictive contract Riley Herbst signed with 23XI Racing, which limits his ability to race in other series without permission, and NASCAR’s alleged anticompetitive exclusivity provisions. Hamlin countered this by emphasizing the distinction: "We aren’t a monopoly," he stated. "You are. I believe it’s different when you have options and drivers have options of what teams they can race for." This assertion highlights the plaintiffs’ central argument that NASCAR’s control over its ecosystem limits competitive opportunities for both teams and drivers.

The discussion then shifted to the financial arrangements between teams and drivers. Buterman pressed Hamlin on the percentage of overall team revenue that drivers receive in their contracts, suggesting it was a smaller portion than what NASCAR distributes to teams from its own revenue streams. Hamlin defended this by pointing to the substantial costs incurred by teams, a point Buterman challenged by noting NASCAR’s own operational expenses. Despite this back-and-forth, Hamlin reiterated his view: "We are not a monopoly like you," and "drivers have options of where to take their services."

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The examination also delved into internal team communications. Buterman presented a text message exchange between Hamlin and Steve Jordan, a 23XI Racing executive, where they discussed signing driver Corey Heim to a long-term contract. Jordan’s instruction to "lock him up" was framed by Buterman as analogous to NASCAR’s alleged practice of "locking tracks up" in an anticompetitive manner. This line of questioning aimed to highlight perceived hypocrisy or inconsistency in the plaintiffs’ arguments.

A significant portion of Hamlin’s testimony focused on a deeply discouraging conversation he had with NASCAR CEO Jim France at the December 2022 awards banquet in Nashville. Hamlin recounted France’s assertion that the primary problem in NASCAR was excessive team spending, with France suggesting teams should aim for $10 million per car in operating costs, a stark contrast to the approximately $20 million per car being spent at the time. Hamlin expressed the impracticality of such a drastic budget cut, stating, "Cutting is not growth. I can’t cut my costs in half. It’s not realistic." He described the current state of cost-cutting measures as having "cut this grass so short that we are down to the dirt."

Hamlin further detailed France’s view that Hamlin represented the "type of owner that NASCAR wants in the sport," differentiating him from speculative private equity investors. However, Hamlin conveyed his inability to further reduce expenditures, emphasizing his significant investment in the sport and his desire to avoid becoming another statistic of team owners forced out of business. According to Hamlin, France offered no viable solution to this dilemma.

During his cross-examination, Buterman presented NASCAR’s offer of a seven-year agreement with an additional seven-year extension option, while rejecting permanent charters. Hamlin explained that the proposed extension years had fixed terms, not tied to revenue percentages, and were not subject to negotiation. He argued that 23XI Racing would not be viable under such terms, particularly given the potential for significantly larger broadcast rights deals after 2031. He pointed out that the extension offered teams "no less than what they make now," a proposition he found untenable, especially considering the teams’ obligation to purchase all car components, which they do not own.

Buterman also scrutinized Hamlin’s demand for $105 million in damages, which represents a substantial return on his initial $45 million investment as a 40% owner of 23XI Racing, with Michael Jordan and Curtis Polk owning the remaining 60%. Hamlin’s response was unequivocal: "We want to be made whole for what you did to us," a statement that, like his earlier remarks, seemed directed beyond Buterman to the NASCAR leadership.

It was revealed in court that Hamlin earns $14 million annually under his current contract with Joe Gibbs Racing. When questioned about his high salary, Hamlin attributed it to his status as "at the top of my game."

The Driver Ambassador Program (DAP) also emerged as a point of contention. Hamlin expressed significant frustration with the program from a team owner’s perspective, despite its personal benefit to him as a driver. Introduced this year and codified in the charter agreement, the DAP compensates drivers for promoting the sport. Hamlin argued that it diverts the teams’ most valuable assets—their drivers—to promote NASCAR initiatives rather than team-specific endeavors. He highlighted that teams bear 40% of the DAP’s costs, and that NASCAR leverages drivers to sell tickets without providing teams with a return on that investment. When Buterman asked if Hamlin opposed drivers being paid, Hamlin retorted, "We pay drivers, not NASCAR." Buterman countered by noting that most drivers do not command Hamlin’s $14 million salary, to which Hamlin responded that most drivers do not achieve his level of success in winning races.

NASCAR’s legal team sought to portray Hamlin as an unreliable narrator, or at least disingenuous, by highlighting past public statements that appeared to contradict his current legal arguments. Buterman pointed to Hamlin’s appearances on the Kenny Wallace Show and the Netflix series "Full Speed," where he offered generally positive commentary on the Next Gen car, including its potential for cost containment and lowering the barrier to entry for new teams. He had even described it as "a net positive for the sport." Hamlin’s explanation for these seemingly contradictory statements was that he was compelled to adhere to NASCAR’s talking points. "Because if I say anything bad, I get a lashing from NASCAR. So, publicly, it’s all sunshine and rainbows," he testified. "My job is to take the talking points NASCAR says to me and say them publicly. If it’s anything bad, I get a phone call from NASCAR." He stated that NASCAR could dictate his public pronouncements, which led Buterman to question the sincerity of his testimony. Hamlin dismissed this, asserting, "What I do publicly is put out positivity. That’s my job. You guys give me talking points. I say it to make fans feel happy."

Further scrutiny fell upon communications from 23XI executives, including remarks from Curtis Polk labeling Hamlin a "terrible businessman" who "spends money recklessly." Hamlin responded by noting that while 75% of teams lost money, 23XI Racing had not, despite competing for wins and championships. He stated he was not offended by his partners’ comments, as it was their role "to keep us in check." He elaborated on the $35 million AirSpeed facility, acknowledging Polk’s initial objections due to ongoing charter negotiations, but explained that the facility was ultimately built because it aligned with the team’s long-term vision, even if there were disagreements about the timing and terms. Hamlin and Jordan’s shared desire to win, he explained, came with a significant cost.

Buterman also introduced a text message from August 2023, in which Hamlin expressed a desire to be bought out of his 23XI ownership, contrasting with his earlier statement to France about wanting to remain in NASCAR long-term. Hamlin clarified that this was a moment of frustration regarding his perceived lack of decision-making power at the time, and that he and his leadership team had since resolved such issues through discussion. He characterized such disagreements as normal within any business enterprise, emphasizing that they consistently found solutions.