Childress Says He Signed NASCAR Charter Only to Avoid Losing His Teams

Veteran NASCAR team owner Richard Childress testified during the seventh day of the federal antitrust trial involving 23XI Racing, Front Row Motorsports, and NASCAR that he wouldn’t have signed the 2025 Charter agreement if he had been financially able to run his business the way he wanted without it.

“I knew financially I couldn’t lose my Charter,” Childress said during his 50 minutes of testimony. “We are a blue-collar operation and proud of it. If we didn’t sign the Charter agreement in 2024, we would have lost them (two Cup Charters).”

Childress, who sold peanuts in the Bowman Gray Stadium grandstand as a youngster during the weekly races, said permanent Charters were essential in building the team’s value so he could pass the operation to his grandsons, Austin and Ty Dillon.

“I would like for it (Richard Childress Racing) to be running 60 years from now, but with this current business model we can’t do it,” Childress said.

Childress told about acquiring a franchise in the Professional Bull Riders Association for $3 million. His PBR team, the Carolina Cowboys, won this year’s team championship.

“We continue to build enterprise value (with the PBR franchise),” the 80-year-old Childress said. “It wouldn’t cost NASCAR anything to give us full franchises like the PBR.

Permanent or evergreen Charters were the No. 1 demand of the teams when negotiating the 2025 Charter agreement. During Jeffrey Kessler’s questioning of NASCAR Chairman Jim France, the attorney for 23XI Racing and FRM read letters from team owners Rick Hendrick, Roger Penske, Jack Roush, Joe Gibbs, and Joe Gibbs Racing co-owner Heather Gibbs asking NASCAR to grant evergreen Charters. Penske wrote in his letter to France that evergreen Charters would be a “fair and equitable solution which could allay many concerns from the teams.”

When the teams began negotiating the 2025 Charter agreement with NASCAR, the teams had “four pillars” from which they wouldn’t waver. They were:

• Permanent Charters
• A say in decisions that impact their costs
• Share of new revenue to compensate teams for their intellectual property assets
• $720 million annually to cover each team’s basic costs of running a competitive car

NASCAR Commissioner Steve Phelps testified Tuesday that paying the teams $720 million annually “would put NASCAR out of business.” He also said:

• The new agreement provided the teams with nearly a $100 million increase in the money they received when compared to the previous Charter.
• The three-strike rule, which was used only once in nine years in the previous Charter, was replaced with a Team Owner Council.
• NASCAR created a committee to identify, negotiate and collaborate on join business opportunities with the teams, such as the ongoing discussions on parimutuel betting.

Phelps, who spent approximately 14 years with the NFL prior to joining NASCAR, disputed the team’s claims that they had very little time to review the 2025 Charter agreement after being given a Sept. 6, 2024, deadline to sign the document. In outlining the Charter timeline, Phelps said:

• The first draft was shared on Dec. 22, 2023
• The second draft on May 28, 2024
• The third draft on Aug. 14, 2024, with a Sept. 1, 2024, deadline.
• Fourth draft on Aug. 30, 2024, with a Sept. 6, 2024, deadline.
• The final agreement was shared with the teams on Sept. 6, 2024, one day after the race teams’ legal counsel, Covington, shared feedback for the teams.
• An amendment proposed by the teams’ lawyers at Covington shortly after NASCAR began sending out execution copies of Charters, which NASCAR agreed to on Sept. 11. That resulted in Amendment 1 of the Charter after 23XI Racing and FRM elected not to sign after being given more time.

23XI Racing and FRM filed an antitrust suit against NASCAR about a month after refusing to sign the 2025 Charter agreement. The two teams claim NASCAR has engaged in anti-competitive acts and is paying the teams below market value. NASCAR disagrees.

France returns to the witness stand Wednesday at 8:30 a.m. Kessler said that when France is finished with his testimony, the plaintiffs will rest their case. NASCAR will begin presenting its case at that time.