Federal Judge Issues Mixed Rulings in High-Stakes Gibbs, Spire, and Gabehart Legal Dispute

Following a two-hour hearing on Wednesday at the Charles R. Jonas Federal Building, Judge Susan C. Rodriguez issued a series of mixed rulings on motions to dismiss from Joe Gibbs Racing (JGR) regarding countersuits from Spire Motorsports and Chris Gabehart.

As is typical in complex commercial litigation, a lawsuit is often followed by a countersuit. In this case, the defendants made a variety of counterclaims against JGR.

Joe Gibbs Racing originally sued Gabehart, who worked at the organization from 2012 to 2025 as an engineer, crew chief, and competition director, alleging the misappropriation of trade secrets for the benefit of his new employer, Spire.

In response, Spire sued JGR over an alleged “oral agreement” and “de facto agreement” concerning an implied deal that saw Spire release championship-winning car chief Robert “Cheddar” Smith from his contract so he could join Gibbs’ No. 54 team, driven by Ty Gibbs, the grandson of team owner Joe Gibbs.

Spire claimed that in exchange for releasing Smith, Gibbs agreed to release an equivalent competition-level employee to join Spire or pay $100,000 for Smith’s services. Smith was released and joined JGR, but Spire allegedly never received a commensurate employee or payment.

Additionally, Gabehart sued Joe Gibbs Racing, claiming his longtime employer actually breached its contract with him, withholding wages and the finality of their agreement in an effort to prevent him from working elsewhere. Gabehart also filed a lawsuit alleging that JGR’s attorneys at the Parker Poe firm breached attorney-client privilege while conducting a digital forensic analysis of the competition director’s company-issued devices after his departure.

JGR had hired a private investigator to follow Gabehart, believing he was preparing to leave for Spire while in possession of proprietary business and competition data. Much of this remains to be determined during the remaining fact discovery phase, summary judgment, and a trial scheduled for February 1.

### What Happened Today?

On Wednesday, Judge Rodriguez effectively denied Joe Gibbs Racing’s motion to dismiss the countersuit from Spire Motorsports regarding Cheddar Smith.

This ruling does not address the merits of the legal arguments, but rather indicates that there are plausible claims for relief if the allegations are true, allowing the matter to proceed. In other words, the counterclaims are not legally or reasonably superfluous.

“On the merits, we’re not there yet,” Rodriguez told all parties while reading her decisions.

JGR attorney Sarah Hutchins argued that any agreement between the two teams was nebulous, as the two parties never crafted a formal contract. She also argued that there was no tangible evidence indicating that JGR had substantially benefitted from hiring Smith.

Spire attorney Joshua D. Davey responded that the No. 54 team has won twice this season and sits third in the standings after Ty Gibbs missed the Cup Series playoffs last year. This occurred after Spire allowed Smith, the 2014 championship-winning car chief, out of his no-compete contract.

“I’m puzzled by the argument that there was no benefit to JGR,” said Davey. “JGR needed a car chief. They got one.”

Judge Rodriguez did not seem moved by the JGR argument.

“This whole lawsuit is about non-competes and (how) they’re valuable, right?” Rodriguez said. “They’re not waived lightly.”

Regarding the countersuit from Gabehart, Judge Rodriguez granted in part and denied in part Joe Gibbs Racing’s motions to dismiss. She is allowing Gabehart’s countersuit on breach of contract, a breach of the implied covenant of good faith and fair dealing, and the North Carolina Wage and Hour Act to continue forward.

Joe Gibbs Racing stopped paying Gabehart’s wages in November before issuing a “for cause” termination letter in February after he signed with Spire. Gabehart is arguing in court that the 18-month non-compete agreement was overly broad and unenforceable. That issue is to be decided later.

On the other hand, Rodriguez granted the motion to dismiss on Gabehart’s claims that JGR violated the Computer Fraud and Abuse Act, North Carolina’s Computer Trespass Act, and unfair and deceptive trade practices law.

“I’m just not sure you’ve got anything plausible here,” Rodriguez told Davis during the hearing.

This was said during an argument in which Davis stated that JGR exceeded its authority to inspect Gabehart’s accounts and computer. Davis was adamant that the legal standard required recognizing that certain communications were privileged and not opening them.

The devices were owned by Joe Gibbs Racing and provided to Gabehart for his use as an employee. In other words, for Davis to argue that JGR’s attorneys did not have the authority to access their own devices did not make a lot of legal sense to the judge.

“If I were to adopt this, I would be making a new law here,” she said. “You’ve got the wrong judge for that.”

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