NASCAR chairman refuses to budge on team charters in testimony during Michael Jordan's lawsuit

Also called Tuesday was Hall of Fame team owner Richard Childress, who testified that he only signed a 2025 revenue-sharing agreement because refusing to do so would have put Richard Childress Racing out of business.

NASCAR Commissioner Steve Phelps testified to the frustrating two-plus years of negotiations between the top motorsports series in the United States and its race teams. The plaintiffs introduced several documents detailing communication between NASCAR executives that showed France was stubbornly opposed to granting teams permanent charters throughout the process.

The charter system is equivalent to the franchise model used in other sports. In NASCAR, a charter guarantees cars a spot in the 40-car field each week, as well as specified financial terms.

Asked by plaintiffs’ attorney Jeffrey Kessler if he has changed his stance on making charters permanent, France said, “No, I have not.”

Kessler later introduced a summary of notes from the first meeting of NASCAR executives on how they would approach negotiations with the teams over the new agreements. Steve O’Donnell, now the president of NASCAR, wrote in those notes, “Jim’s overarching comments — we are in a competition. We are going to win.”

France’s position never changed, even though — as evidence showed — he received pleas from Hall of Fame team owners Joe Gibbs, Rick Hendrick, Jack Roush and Roger Penske. All four are close personal friends, France said on the stand Tuesday.

Earlier Tuesday, Childress spoke to the pressure he felt to sign the charter agreement.

“I would not have signed those charters if I was financially able to do what I do,” the six-time championship winning owner testified. “We are a blue-collar operation.”

Childress has participated in NASCAR for 60 years. NASCAR was founded in 1948 by the Florida-based France family and Childress has a longtime personal relationship with the Frances.

Childress testified that he pleaded with Jim France for the charters to be made permanent instead of renewable, and France refused.

Childress testified he supports the charter system that was implemented in 2016 when race teams “were worth 10 cents on the dollar at most. We didn’t have nothing.”

He admitted that the charters added value to his team, but said the equity falls short of its financial potential if the charters were permanent.

In a declaration of his dissatisfaction with the system, Childress insisted NASCAR attorney Christopher Yates read sentences in which he explains the charters needed to be permanent. He said he added those sentences to a declaration that had been given to him to sign.

Childress was at times contentious with Yates, partly because he was determined to show his displeasure over not receiving permanent charters.

He said he only accepted the offer in 2024 when Hendrick Motorsports said it was signing and “all I know is financially we would be out of business” if he did not follow suit.

Phelps details negotiations with Jordan's team

Earlier Tuesday, NASCAR's commissioner noted that Jordan's financial advisor would not compromise on key issues.

Phelps, who was president of NASCAR during the negotiations, said Jordan right-hand man Curtis Polk was the lead representative for the teams and held firm in their demand for increased revenue, permanent charters, a voice in governance and one-third of any new revenue streams.

The deal finally presented to the teams in September 2024 did not include permanent charters or a voice in governance, but NASCAR gave the teams a firm deadline to accept its final offer or forfeit their charters. 23XI Racing, owned by Jordan, Polk and three-time Daytona 500 winner Denny Hamlin, and Front Row Motorsports, owned by Bob Jenkins, were the only two teams out of 15 organizations that refused to sign. They sued instead.

Phelps, promoted to become NASCAR's first commissioner earlier this year, testified that he worked hard to get the teams the best deal possible. But he said the teams' initial request for $720 million in revenue a year guaranteed to them would have put NASCAR out of business, and communications between NASCAR executives showed that the France family would not budge on permanent charters.

At the same time, Polk would not budge, either.

“It was one of the most challenging and longest negotiations I've ever been part of,” said Phelps, who admitted he didn't particularly enjoy negotiating with Polk, who was at the time the representative for the “Team Negotiating Council.”

“The TNC never wavered off their four pillars. It was just the same thing, the same thing, and that was very frustrating,” Phelps said.

Phelps testified at one point that NASCAR believed it had landed on a new charter agreement that satisfied the teams but it was contingent on NASCAR finalizing its new media rights deal.

“I thought we'd just plug in the numbers,” said Phelps, who testified NASCAR was hoping to land a media deal worth $1.2 billion. When it became clear the media rights deal wouldn't net that much money, Phelps said the teams asked to set a floor in negotiations.

NASCAR ultimately got a media deal worth $1.05 billion — still an increase of $33 million a year from the previous deal — and Phelps said “every dollar” went to the race teams when it began this year.

However, the ultimate revenue payout to teams is $431 million annually, the charters are not permanent and the teams did not get a voice in rules and regulations.

Even so, Phelps testified he believed the charter agreement was “a fair deal.”

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