Chip Ganassi Racing sues IndyCar champion Alex Palou, its own driver, amid contract dispute

Nathan Brown
Indianapolis Star

Chip Ganassi Racing filed a civil lawsuit in Indiana's Marion County Superior Court against its IndyCar driver Alex Palou this week, according to court documents. Palou, who won the series title in 2021 in his first season with CGR, is named as a defendant in the civil suit, along with ALPA Racing, which documents filed on Ganassi's behalf list as Palou's "racing entity."

“Alex Palou is under contract with Chip Ganassi Racing through the end of the 2023 season," the team said in an email to IndyStar. "He is a valued member of our team, and we will continue to support him in chasing wins, podiums, and IndyCar championships. As the result of a competing racing team improperly attempting to contract with him notwithstanding the clear terms of our contract, we are proceeding to legal process pursuant to the contract

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“Any and all inquiries on the matter will be handled by our legal counsel.”

Palou's management team declined to comment to IndyStar.

Though Ganassi's attorneys filed to seal CGR's official complaint, as well as four exhibits in the case, the filing is believed to involve the team's ongoing contract dispute with the 25-year-old driver. Just after 3 p.m. on July 12, Ganassi announced it had picked up Palou's team option for the 2023 IndyCar season, locking down the driver of the No. 10 Honda for at least another year.

Less than four hours later, Palou disputed the notion on Twitter, claiming the team had issued the release without his consent and included a quote that neither he nor his management team had approved that statement about his excitement for returning for the upcoming season. In the series of tweets, Palou also said he'd previously told CGR officials he did not intend to continue with the team after 2022 "for personal reasons."

Minutes later, McLaren Racing sent a news release announcing it had signed Palou to a multi-year deal starting in 2023 to race in a series that would be announced at a future date.

According to court documents, Palou and ALPA Racing were served summons at addresses in Palou's native Spain, as well as an address presumed to be Palou's current residence in Carmel. According to court documents, Chip Ganassi Racing is being represented by four attorneys: John Maley, Mark Owens and Dylan Pittman of Barnes & Thornburg LLP, as well as James Voyles of Voyles Vaiana Lukemeyer Baldwin & Webb. Attorneys for Palou and ALPA Racing were not listed.

Chip Ganassi Racing filed its motion to seal its civil complaint, as well as four of its supporting exhibits from public access, stating they contained "confidential business information" regarding Palou's IndyCar deal with CGR, as well as correspondence between the two parties. Not under seal exist three pieces of evidence Ganassi included on behalf of its case, including a portion of Palou's tweet thread from July 12. Ganassi also included a copy of McLaren Racing's tweet announcing Palou's signing that evening, as well as McLaren Racing's press release detailing the news.

Ganassi has filed a request for a prompt hearing on the motion for preliminary injunction, requesting that it be heard before the end of August. This year's season-finale at Laguna Seca is scheduled for Sept. 11, after which Palou stated in his tweets he plans to join McLaren Racing.

According to court documents, Ganassi has filed an emergency motion for expedited discovery "to prepare for a prompt preliminary injunction hearing." Ganassi has requested the defendants and third parties involved (i.e. McLaren Indy and McLaren Racing) to respond to their requests "completely and without evasion within 14 days of service."

'It'll be up to the lawyers'

Ganassi's lawsuit comes just days before Palou is set to compete on the IMS road course this weekend. The driver of the No. 10 Honda sits sixth in the points race -- 44 points back of teammate Marcus Ericsson -- with five races remaining. Despite Palou and McLaren's assertions to the contrary earlier this month, CGR officials still maintain Palou is contracted to drive for them in 2023. And yet, as Palou told IndyStar this past weekend at Iowa Speedway, the team swiftly took away his access to engineering data away from the track between July 12 and CGR's arrival in Toronto July 14 for that weekend's race

"I'm just going to let my people work this out," Palou said Friday. "It's something I don't really know how to do. It's messy, and I don't like that kind of stuff. Instead of trying to understand what's going on and trying to do everything perfectly, I'm going to try and do everything perfectly on-track and let my people sort it out.

A week earlier in Toronto, Palou said he had full trust in his management team at Monaco Increase Management and believed everything they'd done on his behalf was by the book. Even still, he wasn't about to commit to knowing how the next several weeks and months would shake out.

"I've never been in this position, so I have no idea," Palou told IndyStar in Toronto. "I'm not gonna tell you, 'Yeah, we're going to catch a beer and solve it.' I have no idea, but hopefully it's going to be that way. But I have 100% the power of what I can do."

Arrow McLaren SP driver Felix Rosenqvist has said since Toronto that the conflict would reach this level. Rosenqvist, contracted to race in some capacity for McLaren Racing in 2023 and beyond, would end up in Formula E next year, should Palou land with AMSP in 2023 alongside Pato O'Ward and Alexander Rossi.

"I know (IndyCar) is still a possibility (for me), if X, Y and Z happen, and I'm no magician or predictor," Felix said pre-race at Toronto. "But this is gonna mean lawyers and god knows what else is going to happen."

Rosenqvist added Sunday: "I don't know what's going on there, but at the moment, it doesn't sound like (Palou's) going to race at all (next year). Yeah, it'll be up to the lawyers."

Ganassi, meanwhile, has been silent on the matter, declining multiple interview requests from IndyStar in recent weeks to discuss his spat with Palou or even his team's triumphant weekend in Toronto where team veteran Scott Dixon picked up his first win of 2022 and the team put three drivers in the top-6.

Following that weekend, Ericsson reasoned that his relationship with Palou hadn't changed, but Dixon and second-year Ganassi driver Jimmie Johnson had made concerted efforts to distance themselves from Palou in reaction to the developments.

"It sounds pretty complicated. To me, I was just really disappointed in how it was handled," Dixon told IndyStar in Toronto. "For me, honesty is key, man. Loyalty is as well, but this is a small community, and it can change how you're looked upon or respected quite quickly. My personal view from myself and how I would've done this? It wouldn't have looked like this.

 "All my deals with Chip have been very straight-forward. We sit down, have a chat at what everybody's looking at doing, and even when I've had options, I've gone to him and said, 'These are my options. What should we do?' I've always respected the black-and-white function of how the operation's been with me.

"Perhaps the biggest surprise in all this is how starkly the landscape has changed from a year ago, when Ganassi was heaping praise on his young title-winner who won in his first race with CGR, finished on the podium in 50% of the races and generally was unfazed as Josef Newgarden, Pato O'Ward and even Dixon were breathing down his neck.

In May of 2021, before Helio Castroneves narrowly edged him in the Indy 500, Ganassi scoffed at the idea of this young wave of drivers coming into the series and supplanting legends like Dixon from the top of the sport. "Youth movements come along, but champions endure. That's what Scott Dixon does," Ganassi said.

By September, his tone had changed. Palou, it seemed then, was his next cornerstone driver of the future. "He's a lot like Dixon," Ganassi said of Palou in Long Beach. "Kind of not a lot of baggage. Just focuses. A lot like, yeah, Dixon."