On November 8, 2024, United States District Judge Frank D. Whitney of the Western District of North Carolina declined a motion for a preliminary injunction requested by two stock car racing teams against NASCAR. The case, 2311 Racing LLC, et al. v. National Association for Stock Car Auto Racing, LLC, et al., No. 3:24-CV-00886-FDW-SCR, involved a dispute over the enforcement of a legal release clause in NASCAR’s 2025 Cup Series Charter Member Agreements. The teams sought to block NASCAR from implementing the clause, which they argued would compel them to forgo their antitrust claims while still allowing them to compete as charter teams. However, the court denied the motion, stating that the plaintiffs had not demonstrated the irreparable harm required for such relief.
The lawsuit, filed last month, accuses NASCAR and its CEO of monopolizing the premier stock car racing industry. The teams argue that NASCAR’s charter system stifles competition by binding teams to its series, imposing restrictive policies, and exploiting its control over key racetracks.
Unlike traditional sports leagues, NASCAR teams are independently owned and must qualify for participation. They can either sign a Charter Agreement, guaranteeing a spot in events but subjecting them to NASCAR’s rules, or compete as non-chartered teams on a race-by-race basis. Plaintiffs allege that NASCAR uses its dominance to pressure teams into signing these agreements without providing sufficient time to review or negotiate terms, including a requirement to waive certain legal claims.
To secure a preliminary injunction, plaintiffs needed to prove: (1) a strong likelihood of success on the merits; (2) a high probability of irreparable harm if the injunction was denied; (3) that the balance of equities tipped in their favor; and (4) that granting the injunction aligned with public interest. Plaintiffs claimed that failing to compete as charter teams would lead to severe financial and reputational damage, potentially driving them out of the market. They also argued that signing the agreement would force them to waive significant antitrust claims that could benefit all premier teams.
Plaintiffs identified potential harms such as losing sponsors, drivers, and revenue, which they said could lead to insolvency. Although they acknowledged the option to compete as non-chartered teams, they argued that this left them vulnerable to NASCAR’s discretion to exclude them, further risking their relationships with fans and sponsors.
The court, however, ruled that the plaintiffs failed to demonstrate the immediate and concrete threat of irreparable harm. Judge Whitney described their claims as speculative, noting that the 2025 season had not yet begun and that the alleged harms were contingent on uncertain future events, such as third-party actions. The judge also dismissed the notion that NASCAR might exclude the teams from events, stating that this was purely hypothetical.
In his decision, Judge Whitney remarked that the plaintiffs were “no closer to irreparable harm than they are to the command, ‘Drivers, start your engines,’” for the 2025 season. He emphasized that preliminary injunctions are reserved for situations where survival is at stake but left the door open for the teams to renew their motion if circumstances change. The plaintiffs have since filed an appeal with the Fourth Circuit, seeking further relief.
