A high-profile economist testified Monday that NASCAR should pay $215.8 million in damages to 23XI Racing and $148.9 million to Front Row Motorsports to account for its monopolistic behavior. Dr. Edward A. Snyder, who served as the dean of Yale’s business school from 2011-19 and for 10 years before held the same position at the […]
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Economist testifies that NASCAR underpaid teams $1.06B over 4 years
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A high-profile economist testified Monday that NASCAR should pay $215.8 million in damages to 23XI Racing and $148.9 million to Front Row Motorsports to account for its monopolistic behavior.
Dr. Edward A. Snyder, who served as the dean of Yale’s business school from 2011-19 and for 10 years before held the same position at the University of Chicago, shared his calculations as part of his extensive testimony on Day 6 of the trial pitting 23XI Racing — co-owned by Michael Jordan and NASCAR driver Denny Hamlin — and Front Row Motorsports against NASCAR.
They were the only two of the 15 teams competing in NASCAR that refused to sign the organization’s charter agreements last year, then they filed the antitrust lawsuit being heard in Charlotte, N.C.
Snyder, a frequent witness in such high-profile trials, declared that NASCAR fits the description of a monopolist because the organization controls the tracks, the teams and the cars.
“This is anti-competitive,” Snyder said according to media reports. “Clear and simple.”
He added, according to The Athletic, “To me, as an economist, this situation bothers me. Team owners are building the car. They technically own the car, and it’s their most important piece of equipment. But they cannot use it outside of NASCAR. That’s anti-competitive.”
Snyder also insisted that NASCAR shortchanged its charter teams $1.06 billion over a four-year span that began in 2021. His calculations, in part, were based on his discovery that Formula One pays teams 45% of its revenue while NASCAR only shares 25%.
NASCAR’s legal team tried to undercut Snyder’s testimony, in part, by responding that Snyder’s 45% estimate for F1’s payouts is incorrect.
Snyder will continue his testimony on Tuesday in a trial that has not been progressing as quickly as Judge Kenneth D. Bell anticipated. He expected the trial to last two weeks, but the prosecution still has a handful of witnesses to go.
–Field Level Media