Denny Hamlin testifies that signing NASCAR’s charter deal would have been a ‘death certificate’

Three-time Daytona 500 champion Denny Hamlin delivered startling testimony Tuesday in the federal antitrust trial against NASCAR, revealing that his race team spent over $700,000 in fees to the racing series in 2022 alone. Hamlin stated that accepting NASCAR’s charter proposal last fall would have been equivalent to signing his own “death certificate.”

Hamlin, who co-owns 23XI Racing with NBA legend Michael Jordan, was the first witness called when testimony began Monday in the antitrust lawsuit filed by 23XI Racing and Front Row Motorsports. The teams allege that NASCAR operates as a monopoly that has trapped teams in an unsustainable revenue model.

During his three-hour testimony, Hamlin detailed specific expenses from 23XI Racing’s budget, highlighting how the team paid NASCAR more than $703,000 three years ago for various necessities including entry fees, staff credentials, and even internet access at race venues. He testified that he and Jordan invested $100 million to build 23XI Racing, adding that “all it takes is one sponsor to go away and all our profit is gone.”

The lawsuit comes after prolonged negotiations between NASCAR and its 15 teams, who have vocally maintained for over two years that the previous charter agreement made profitability impossible. When NASCAR’s final offer failed to address most of the teams’ demands, 23XI and Front Row refused to sign and opted to sue instead.

While 23XI has managed to turn a profit in four of its five seasons of operation, Hamlin attributed this success largely to Jordan’s star power attracting premium sponsors. According to plaintiffs’ attorney Jeffery Kessler, a NASCAR-commissioned study found that 75% of teams lost money in 2024, underscoring the widespread financial challenges across the sport.

Hamlin also expressed concerns about NASCAR’s new television deal taking effect in 2025, noting that the shift toward streaming services could negatively impact teams since major sponsors prefer television exposure. He recounted a meeting with NASCAR chairman Jim France where France suggested teams were overspending, claiming a competitive car should cost around $10 million to operate. Hamlin testified that the actual cost is closer to $20 million.

“We cannot cut more. Tell me how to get my investment back? He had no answer,” Hamlin recounted from his conversation with France.

Regarding his refusal to sign the charter agreement last fall, Hamlin was unequivocal: “I didn’t sign because I knew this was my death certificate for the future.” He added, “I have spent 20 years trying to make this sport grow as a driver and for the last five years as a team owner. 23XI is doing our part. You can’t have someone treat you this unfairly and I knew it wasn’t right. They were wrong and someone needed to be held accountable.”

When cross-examined about why he presents a more positive view of NASCAR in his podcast appearances, Hamlin claimed he often repeats NASCAR talking points because negative comments can lead to various forms of retribution, including unfavorable technical inspections and being summoned to the NASCAR hauler.

The trial, expected to last two weeks, has already revealed significant financial disparities in the sport. NASCAR, owned and operated by the Florida-based France family since 1948, was valued at $5 billion in a 2023 Goldman Sachs evaluation. Court documents showed that nearly $400 million was paid to the France Family Trust over a three-year period, and NASCAR reportedly made more than $100 million in 2024 alone.

Meanwhile, Front Row Motorsports owner Bob Jenkins testified in a deposition that he has lost $60 million over the past decade and $100 million total since founding his team in 2004.

NASCAR has defended its practices, arguing that the original charters were provided to teams at no cost when the system was created in 2016, and that demand for these charters has generated $1.5 billion in equity for chartered organizations. The racing body also pointed out that each chartered car now receives guaranteed annual revenue of $12.5 million, up from $9 million previously.

Hamlin countered these claims by noting that 11 of the original 19 chartered organizations are now defunct, and all three of 23XI’s charters came from teams that ceased operations. He reiterated that fielding a single car for all 38 races costs $20 million, excluding overhead, operating costs, and driver salaries.