Rick Ware Racing should be prevented from selling racing agreements before trial, Legacy argues

CHARLOTTE, N.C. (CN) —  Legacy Motor Club and Rick Ware Racing argued before a Charlotte judge Wednesday over a preliminary injunction request that would tie up Rick Ware Racing’s charters.

Legacy and Rick Ware Racing have been embroiled in a contract dispute over which racing contract Rick Ware sold to Legacy — #36 or #27 — both of which are now involved in a pending sale to T.J. Puchyr, co-founder of Spire Motorsports.

Counsel for Legacy told the court the racing charters could be lost if Rick Ware Racing finalizes a deal with Puchyr, who originally brokered the agreement between the parties. At the end of July, Legacy won a 10-day temporary restraining order, posting a $5 million bond to block the sale. Legacy requested the court bar Rick Ware from selling the charters until trial in January.

Rick Ware Racing’s attorney, Mark Henriques, argued Legacy is trying to tie up both of the team’s charters. He said the company has been clear throughout the proceedings that it may sell an ownership stake or one or both charters while keeping Cody Ware on the track. Court intervention, he added, would restrict the company’s ability to make those decisions.

Legacy originally asserted that the contract was over #27, Henriques said, but is now trying to prevent #36 from transferring hands as well.

“How can they say that there is clear and convincing evidence that it (the contract) is both 27 and 36?” Henriques asked. Legacy could still get economic damages if Rick Ware Racing sells the charters and Legacy is successful during trial, he added.

“We were allowed to do it and said we wanted to do it,” he said in regard to the sale.

The court hadn’t previously issued an injunction preventing Rick Ware Racing from selling either of its agreements, and the company’s prior statements did not mean that the company would never sell the charters, Henriques said. The idea that Rick Ware Racing can’t do anything with either charter is “troubling,” he said.

Legacy is just trying to protect its assets, Keith Forst, counsel for Legacy, said.

“It is indisputable that there is a deal for the sale of a charter. There is a written contract, every page initialed… they had a written agreement and they agreed to sell a charter and Legacy agreed to buy a charter.”

“The only question is if it was 27 or 36,” he added. Rick Ware Racing made statements before the court saying that #36 would be available to race in 2027, Forst said, asking that the court “maintain the status quo.”

Legacy’s goal is to preserve the charters, Forst said, arguing a sale would dictate the outcome of the case. He described the deal with Puchyr as a “fallback plan” and noted the transfer of cars, equipment, charters and the company is not imminent, so Rick Ware Racing wouldn’t be immediately harmed.

Forst urged Mecklenburg Superior Court Judge Clifton Smith to freeze the sale of both agreements, noting the court has previously issued injunctions broader than what was ultimately recovered at trial.

Puchyr is not open to letting Legacy race under one of the agreements, Legacy said, and without court intervention, its chance to gain a charter as relief may vanish.

Legacy’s lawyers said they were blindsided by the sale, only learning of it through news reports. In July, they sought a rapid deposition, warning Rick Ware Racing might be trying to expedite a sale before Legacy could request emergency relief.

A previous judge had warned Rick Ware Racing it could face “serious consequences” if it sold the agreements after telling the court it would not.

Rick Ware Racing has remained consistent, Henriques said, and was well within its right to work out a deal benefiting the company.

Rick Ware, who was present at the hearing, told Courthouse News that Legacy’s claim that his company walked back on what it previously said in court took statements out of context.

Counsel for Legacy declined to comment after the hearing and said they were anticipating Smith’s order.

Legacy sued Rick Ware Racing in April, alleging it backed out of a signed charter sale agreement. Rick Ware responded with counterclaims, accusing Legacy of attempting to secure a different racing contract than the one agreed upon.

In court filings, Rick Ware Racing insistedit would never have sold #27 to Legacy, as doing so would have left the team unable to race, and owner Rick Ware had no intention of selling the business. In court Wednesday, Henriques said that as there was no ‘meeting of the minds,’ comparing the agreement with Legacy to the sale of a house, without closing on it.

“There is no contract there,” he said, because there is a fundamental disagreement over what was bought.

Smith said that he will have an order in by Friday, August 22, directing the parties to draft a variety of proposed orders that would limit one charter, both or none, instructing counsel to be as “creative as possible” in potential options.

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