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Michael Jordan And Joe Gibbs’ daughter-in-law was expected to testify Friday in the fifth day of the federal antitrust case over claims the Basketball Hall of Famer has filed against NASCAR alleging the series acted as antitrust felon.
Joe Gibbs Racing Chief Operating Officer Heather Gibbs wrote an emotional letter to NASCAR President Jim France In May 2024 he was requested to make the charter permanent to strengthen the family business.
Charters are the equivalent of the franchise model used in other sports and in NASCAR it guarantees each chartered car a spot in all 38 races, as well as a defined payment from NASCAR. The system was created in 2016 and followed more than two years of bitter negotiations over expansion as teams pleaded to make renewable charters permanent.
When NASCAR refused to make them permanent and gave teams six hours to sign a 112-page extension through September 2024, 23XI and Front Row Motorsports were the only two of the 15 organizations that refused and instead filed an antitrust lawsuit.
23XI is owned by Jordan and three-time Daytona 500 winner denny hamlinAnd Front Row is owned by fast food franchisor Bob Jenkins.
The discovery phase of the trial revealed a letter sent to France by Heather Gibbs, who is now president of the chain her father founded 76 years ago.
He wrote, “We have spent 32 years investing and building a dream, building careers, raising a family, and building NASCAR. If the financial model had made sense, we would not have had to work with an outside investor.” “If our teams were financially healthy and not dependent solely on sponsorship, I would sleep better at night, not worrying about when the torch will be lit.
“We have invested not only our time but also our families in this sport. We have raised champions and buried their leaders while embracing NASCAR’s historic roots,” he said in an emotion-filled two-page letter. “So, with all due respect, please understand that it is disappointing and truly disappointing when you tell us that there is no point in partnering with us after 7 years.”
The letter surfaced Thursday in testimony from NASCAR president Steve O’Donnell, who was called as an adverse witness. “Jim is now reading Heather’s letter out loud and swearing at every other sentence,” O’Donnell told Jim France’s nephew Ben Kennedy in a text message.
Asked by plaintiffs’ attorney Jeffrey Kessler what France was saying as he read the letter, O’Donnell said the chairman never took the oath. Kessler tried to pressure O’Donnell to reconcile what he had written to Kennedy, but O’Donnell said his boss was not bashing.
“That’s what I wrote, but he wasn’t doing it,” O’Donnell testified. “We were all shocked by the letter. I think Jim was disappointed, as were we all.”
Joe Gibbs ultimately signed the charter agreement, but Jenkins testified that his rival team owner apologized for doing so.
Kessler attempted to portray France as “a brick wall” in talks Thursday. The teams had made specific requests in an attempt to improve their financial situation, but the deal ultimately awarded to them on the eve of the start of the 2024 playoffs lacked most of their requests.
NASCAR was founded in 1948 by the late Bill France Sr. and remains privately owned by a Florida-based family to this day. Jim France is his youngest son.
Kessler had a contentious session with O’Donnell lasting more than three hours and at times yelling at the executive. He used internal communications among NASCAR executives to demonstrate frustration among non-France family members over the slow pace of negotiations and Jim France’s refusal to grant permanent charters to the teams.
Internal communications between officials reflected growing frustration over the lengthy negotiations. As O’Donnell, Commissioner Steve Phelps and others tried to find concessions for the teams, they all indicated they faced repeated resistance by France and his niece, Vice Chairman Lesa France Kennedy.
Kessler told O’Donnell, “Mr. France was a brick wall in the negotiations.”
The executive replied, “Those are your words, not mine.”
Teams tell NASCAR they are fighting for financial survival
Earlier Thursday, O’Donnell testified that teams had approached the sanctioning body seeking a better revenue model as early as 2022, arguing that the system was unsustainable.
O’Donnell was in a meeting with representatives of the four teams, who asked for the negotiating window on a new charter agreement to be opened quickly as they were fighting for their financial survival. The negotiation window was not scheduled to open until July 2023.
O’Donnell testified that at that first meeting, four-time series champion Jeff Gordon, now vice president of Hendrick Motorsports, specifically asked if the France family “was open to a new model.”
Kennedy, the great-grandson of NASCAR’s founder, said yes to Gordon.
But O’Donnell testified that Chairman France was opposed to a new revenue model.
Both sides talk of financial difficulties
The expansion that began this year increased the guaranteed amount from $9 million to $12.5 million in annual revenue for each chartered car. Both Hamlin and Jenkins testified that it cost $20 million to bring a car to the track for all 38 races. That figure doesn’t include any overhead, operating costs or driver salaries, and Jenkins acknowledged he doesn’t spend that much.
NASCAR has argued that it has made major improvements for teams as it works to grow the sport. O’Donnell testified that NASCAR lost $55 million over three years racing on Chicago’s city streets, and $6 million during a race in Mexico City in June. But he said these events were important for increasing viewership and signing Amazon As a media partner.
“This was a strategic investment because if it had not happened, Amazon would not have been able to become a broadcast partner,” he testified.
odds and ends
Judge Kenneth Bell warned both sides over the slow pace of the trial, which was initially expected to take two weeks. Kessler said he doesn’t expect teams to be finalized until the middle of next week.
NASCAR plans to call Roger Penske as a witness. Penske, who is reluctant to testify, has said he will only be available next Monday. NASCAR lead attorney Christopher Yates requested that Penske be allowed to testify that day but Kessler objected because it would disrupt the flow of his presentation.
Bell sided with Kessler and asked NASCAR to work it out with Penske because “federal testing is an inconvenience.”
The judge also said that it was not acceptable for the trial to drag on for three weeks, and although he was hesitant in taking steps to advance the motion, he urged both sides to advise their witnesses not to be “reluctant to answer even the most harmless questions”.
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