23XI Racing and Front Row Motorsports filed a motion on Wednesday to dismiss a counterclaim filed by NASCAR in which the sanctioning body alleged they had "embarked on a strategy to threaten, coerce, and extort NASCAR."
According to documents filed on Wednesday, 23XI Racing and Front Row Motorsports called this counterclaim an "act of desperation." They stated in the documents that NASCAR could not plausibly show a "contract, combination, or conspiracy in restraint of trade" that would violate Section 1 of the Sherman Act.
On March 5, NASCAR's legal counsel filed the counterclaim and alleged that the two teams and 23XI co-owner Curtis Polk had used collusive behavior during charter negotiations. The counterclaim alleged that the behavior included "a group boycott and threatened group boycotts of NASCAR events."
MORE: Full Motion to Dismiss
According to documents filed Wednesday, there was no actual allegation that a threatened boycott of qualifying races took place.
"NASCAR's retaliatory counterclaim is an act of desperation that cannot withstand a motion to dismiss," the two teams stated in court documents. "It does not allege the facts necessary to state a claim.
"Instead, NASCAR is using the counterclaim to engage in litigation gamesmanship, with the transparent objective of intimidating the other racing teams by threatening them with severe consequences if they support the Plaintiffs' challenge to the unlawful NASCAR monopoly.
"NASCAR's lead counsel used the filing of the counterclaim as an occasion to conduct a press conference in which he delivered a warning that NASCAR will end the charter system that the racing teams depend on if Plaintiffs prevail in their antitrust claims."
The press conference referenced in the court documents took place on March 5. Chris Yates, part of NASCAR's legal team, answered questions from media members for several minutes and alleged that 23XI Racing and Front Row had attempted to misuse the legal system.
Yates said that the ongoing lawsuit against NASCAR and CEO Jim France was endangering the continuation of the charter system. He also said that NASCAR did not want the charter system, a point that 23XI and Front Row mentioned in the motion to dismiss while discussing the 2025 charter negotiations.
"After completing those negotiations, NASCAR President Steve Phelps declared: 'I think the charter system is a good thing for NASCAR and the growth of this sport,'" 23XI and Front Row said. "In this litigation, too -- as this Court has recognized -- NASCAR has argued repeatedly that the charters are a 'fair and beneficial deal for all concerned.'
"It is only now -- after a preliminary injunction was granted against it and its motion to dismiss Plaintiffs' monopolization claims was denied -- that NASCAR has had the epiphany that it should claim that it, not the racing teams who have no choice but to accept the charter terms imposed by NASCAR through its monopsony power, is the real victim of a Sherman Act violation."
Along with the motion to dismiss, Front Row Motorsports seeks to be dismissed from NASCAR's counterclaim. The organization notes that the counterclaim did not set forth any allegations against it. Instead, NASCAR and the sanctioning body's legal counsel primarily focused on 23XI Racing and Polk when discussing the alleged conspiracy.
"With respect to Front Row, the complaint must be dismissed for the further reason that NASCAR does not allege any specific conduct by Front Row or its owner or employees to support a claim that it participated in the alleged conspiracy," Front Row Motorsports stated in its motion.
"Rather, the only specific, non-conclusory factual allegations about Front Row in the counterclaim are that Front Row participated in the Race Team Alliance ("RTA") -- a decade-old trade group of race team owners whose conduct NASCAR has never before challenged."