The veteran Stewart Haas Racing team previously this year announced to shut operations with the conclusion of the 2024 season. Now out of their four charters, they decided to retain one to run a single driver Cup team next season under the name of Haas Factory team. Which means, the remaining three were up for sale.

Out of the three, Justin Marks’ Trackhouse Racing purchased one to field Shane van Gisbergen in the third car for the next season. And as for the remaining two, 23XI Racing and Front Row Motorsports, each have agreements in place to buy them. However, for the process to be completed, they need approval from NASCAR. Now, the catch is things are on a halt with the ongoing antitrust lawsuit.

The two teams, which highlighted the organization’s monopolistic practices, asked the court for a preliminary injunction which would have granted them the opportunity to continue competing as either a charter or an open team next season without compromising on their right to continue their lawsuit against NASCAR. Turns out, as part of his state of the sport session at Phoenix Raceway, NASCAR President Steve Phelps announced a court ruling to the reporters.

The preliminary injunction has been denied by U.S. District Judge Frank D. Whitney just this Friday, meaning the two teams don’t get the status of charter teams. This is despite the plaintiffs’ attorney Jeffrey Kessler stressing the importance of the same: “If we do not have charters, our drivers are free to leave, including the driver who may be the champion of NASCAR,” hinting at Championship 4 contender, Tyler Reddick. The judge, however, was convinced and cited the following reasons:

• Failure to allege a “present prospect” of the harm that would be incurred by the loss of sponsors,
• Failure to allege a “present prospect of the loss of drivers” who would be unwilling to stay as open teams,
• Failure to allege “their business cannot survive without a preliminary injunction,”
• “Plaintiffs have alleged only a potential loss of goodwill, contingent on a host of events occurring”
• “Plaintiffs have alleged only a potential loss of goodwill, contingent on a host of events occurring“

As the judge ruled it out based on how the teams could allege irreparable harm that is only speculative in nature, their 2025 status in NASCAR hangs in the balance. One thing is for certain: The teams will appeal the decision. Both 23XI racing and FRM field two cars each, but now, according to NASCAR, in the 2025 season, there would only be 32 cars rather than 36, with 8 open entries. So this leaves a big question- what happens to the Tony Stewart-owned SHR’s two unsold charters that 23XI and FRM planned to buy?

Meanwhile, Fox Sports journalist Bob Pockrass asked NASCAR president Steve Phelps this very question. Pockrass first quoted Phelps saying, “Phelps: We are not going to negotiate in the media about charters. Ever.

“And we are very happy that 32 of the 36 charters were extended because those were race teams that, where the deal that was put on the table for them, the primary big win for the race teams was money.”

According to Phelps, the new charter gives the signees a substantial amount of revenue cut, making them “the single largest beneficiary” in the deal. Pockrass then followed up with his personal opinion and wrote,

“Phelps says no comment on the SHR charters and what could happen to them as he doesn’t know what happens to them. My guess reading between the lines is that he has not gotten formal paperwork about those transfers.” This must leave Tony Stewart in a pickle since the charters are worth between $20-30M apiece, as was previously reported by Adam Stern of the Sports Business Journal.

Also, if the two teams have to race as ‘open teams’, doesn’t that mean they have to drop the charges? Let’s not forget that Bob Pockrass had previously reported, “23XI/FRM state open team agreement also requires them to waive right to pursue this type of lawsuit so injunction needed to race.” However, the Michael Jordan-led 23XI team and FRM had earlier talked about how they would race, no matter what, for their sheer love of the sport.

What is next for the two teams?

At the moment, this confirms that 23XI and FRM have no charters for the 2025 season. However their lawyer, Jeffrey Kessler recently talked about the next steps, he said, “We are disappointed that the preliminary injunction was denied without prejudice and as premature, which we intend to appeal, this denial has no bearing on the merits of our case. My clients will move forward to race in 2025 and fight for a more fair and equitable system in NASCAR that complies with antitrust laws.”

Earlier, the teams had argued that the absence of an injunction would mean irreparable harm to them. Kessler argued that their drivers might leave the team in the absence of the charter status. The 2024 regular season champion, current championship contender, and a star performer of their team, Tyler Reddick, is permitted to terminate his contract with the team if there is no charter for his car.

Another reason was that the teams could lose a substantial amount of revenue since it comes from race purses which are only for chartered teams. But the court remained dissatisfied with the argument.

The Judge said, “Although Plaintiffs have alleged that they will face a risk of irreparable harm, they have not sufficiently alleged present, immediate, urgent irreparable harm, but rather only speculative, possible harm.” 

As of now, the teams have the option to file a new motion and have until December 2nd to respond. What do you think will happen in the case of SHR’s charters? Share your thoughts with us in the comments below.