Antitrust Trial: Front Row Motorsports Owner Details Financial Struggles as NASCAR Executive Faces Scrutiny

The antitrust trial between 23XI Racing and Front Row Motorsports against NASCAR entered its third day, marked by the continued testimony of NASCAR’s Executive Vice President and Chief Strategy Officer, Scott Prime, and the commencement of testimony from Bob Jenkins, owner of Front Row Motorsports. The proceedings, held in court, delved into the intricacies of NASCAR’s charter system, intellectual property restrictions, and the financial realities faced by team owners.

Scott Prime, who had already spent the latter half of Tuesday on the stand, returned to the witness box on Wednesday. His examination by attorney Jeffrey Kesseler, representing 23XI and Front Row, was at times described as contentious, prompting Kesseler to offer an apology for raising his voice. Prime, responding with understanding, acknowledged the inherent passions involved in the proceedings.

Kesseler’s line of questioning began by focusing on the "goodwill provision" within the charter agreement. This clause, which requires NASCAR approval for team owners with a 10% ownership stake to compete in or own a stake in another racing series, and mandates a 12-month waiting period before such involvement if leaving the Cup Series, was a central point of contention. Kesseler challenged the term "goodwill," suggesting it was more accurately described as an "anti-competitive will," an assertion that drew an objection from NASCAR’s legal team. Prime maintained that he considered the provision to be in line with "goodwill."

The discussion then shifted to the NextGen car and its intellectual property restrictions, which the plaintiffs argue serve to restrain trade. Kesseler presented previously discovered documents where Prime had expressed concerns about the previous generation car, the Gen-6, and its "increased risk to NASCAR of copycat series" due to looser intellectual property protections. Prime stated that this was never a point of contention with the teams, asserting that they understood and endorsed the NextGen car’s design and its associated protections, which also aimed to provide a degree of cost containment. However, Kesseler highlighted that under current charter rules, teams do not have a formal voting mechanism on such matters.

Related News :

Evidence presented included an email from February 10th, sent by Prime to NASCAR executive Ben Kennedy, expressing disappointment over race teams ceasing negotiations for the 2025 charter extension and instead exploring "all our options." The teams had reportedly presented four key demands: 45% of industry revenue, exemption from the Driver Ambassador Program fees, 30% of new revenue generated by team intellectual property, and permanent charters.

When these demands were not met, discovered documents revealed internal NASCAR discussions about contingency plans. These included proposals such as reducing the number of charters to 32 and offering them on a "first come, first serve" basis to existing charter holders, a tactic Kesseler likened to creating scarcity. Another option was a hard deadline for agreement, which ultimately materialized on September 6, 2024. A more drastic plan, "Project Gold Codes," envisioned NASCAR operating vertically, running races independently of teams, and fielding its own drivers and cars.

In an email exchange presented, NASCAR executive Steve O’Donnell responded to Prime’s concerns by stating, "They are playing with fire. Lots of options but all have the same theme: Pick a date and they can sign or lose their charters. It is that simple." Kesseler characterized this as a clear example of monopolistic behavior, enabling NASCAR to dictate terms with the threat of exclusion from the sport. Prime, however, countered that these options represented contingency plans in case teams formed a "breakaway series" and that another path involved continued efforts to "find a middle ground." Notably, despite the deadline, no new team owners were issued charters for the 2025 season.

Prime’s defense for the "locking up tracks" discussions was that it was part of multi-year scheduling agreements, citing TNT’s desire to broadcast from Atlanta due to its proximity to Turner Sports’ operations. Kesseler challenged this, questioning the necessity of new, multi-year exclusivity clauses within these agreements.

The court also revisited "The Amanda Chart," a document created by NASCAR’s Chief Legal Officer, Amanda Oliver, which reportedly outlined 22 team requests with only a single "win" for the teams during negotiations. Text messages from May 20-21 between Prime, O’Donnell, and NASCAR executive Lesa Kennedy revealed internal disagreement with CEO Jim France’s negotiating posture. O’Donnell expressed frustration, stating that the approach was akin to "taxation without representation."

Despite efforts by senior leadership to mediate, the teams were presented with a September 6th deadline to sign the extension, which Prime described as a "gun to the head" offer. Jenkins, who was at dinner with his parents and had no cell service at the time, recounted receiving numerous calls and texts upon leaving the restaurant. He stated that no owner expressed happiness with signing the agreement, with Joe Gibbs reportedly feeling he had let Jenkins down by signing. Jenkins characterized the final agreement as "insulting" and a step backward, likening NASCAR’s governance approach to "taxation without representation." He acknowledged the conceptual soundness of the charter system introduced in 2016 but argued that the 2025 document lacked necessary refinement.

Bob Jenkins, the owner of Front Row Motorsports, then took the stand. Unlike the high-profile figures of Denny Hamlin and Michael Jordan, Jenkins became a central focus of the afternoon’s proceedings. He testified that Front Row Motorsports loses approximately $6.8 million annually and has never turned a profit under his ownership, nor does he draw a salary. His involvement is limited, attending about a dozen races and visiting the shop 6-7 times a year.

Jenkins detailed a significant increase in operational costs under the NextGen car, with annual spending on car components rising from $1.8 million to $4.7 million. He explained that under the previous car generation, teams could repair parts themselves, whereas now, parts must be sent to NASCAR-mandated vendors for refurbishment, costing Front Row $30,000 per week for an undamaged car. When asked about the motivation behind continuing these financial losses, Jenkins stated his belief in the team and his responsibility to its 150 employees.

Jenkins described the September 6th "take it or leave it" offer as a shock, received while he was at dinner. He confirmed that 13 of the 15 Cup Series teams signed the agreement by the midnight deadline, while 23XI Racing and Front Row Motorsports did not, leading to the current lawsuit.

During cross-examination by NASCAR attorney Lawrence Buterman, Jenkins faced questions similar to those posed to Denny Hamlin regarding the hypocrisy of suing NASCAR over non-compete clauses while implementing them in driver contracts. Jenkins reiterated that Front Row is not a monopoly and drivers have alternative options. Buterman questioned Jenkins’ claims of losses, suggesting profits might be hidden through other companies. Jenkins’ charitable foundation, Lakeway Christian Schools, has been offered as an alternative for sponsors or pay drivers, a practice Jenkins stated has not resulted in donations.

Buterman also scrutinized Front Row’s practice of paying drivers only 8.5% of team revenue while arguing NASCAR underpays teams at 25% of sanctioning body revenue. Jenkins countered that this was an "apples and oranges" comparison due to the substantial expenses incurred by teams, such as the $350,000 cost of a NextGen car. He further questioned Jenkins’ financial claims by referencing Front Row’s decision to run five races unsponsored with the Long John Silvers branding, a franchise owned by Jenkins and his sons. Jenkins explained this was due to contractual obligations and the inability to justify charging other sponsors more.

Buterman contended that Front Row was seeking additional funding from NASCAR to compensate for a business that was already losing money prior to the charter system’s introduction. He also suggested Jenkins advocated for smaller fields and the elimination of open entries to increase his team’s share of NASCAR’s revenue. Jenkins defended this stance by asserting that a more exclusive entry point enhances the value for all participants, and that open entries, with the exception of the Daytona 500, generally offer less value to the series. Jenkins’ cross-examination is scheduled to continue on Thursday.