Alex Palou's lawyers accuse Zak Brown of "deceiving" him with tall F1 promise amid $30M McLaren contract dispute

McLaren's contract dispute court case against Alex Palou got off to a blazing start this week. Lawyers representing each side used blunt arguments to solidify their case, including Palou's side calling Arrow McLaren a "second-class team" and McLaren's lawyers calling the four-time IndyCar champion a "serial contract breaker."

For the unversed, Alex Palou signed a contract with McLaren in 2022 to join its IndyCar team, Arrow McLaren, in 2023. However, he was under contract with Chip Ganassi Racing, and the team forced him to push that move to 2024.

Midway through 2023, the Spaniard decided he wouldn't join the Zak Brown-led team because he didn't see a possible move to drive for McLaren in F1, which Brown had allegedly promised him. The team had locked Lando Norris and Oscar Piastri on multi-year contracts, leaving no space for Palou.

Zak Brown with Oscar Piastri and Lando Norris at the F1 Dutch Grand Prix - Source: Getty

Alex Palou breached his McLaren contract and continued with Chip Ganassi Racing. McLaren claimed that this breach cost them around $30 million, with the sponsors that came aboard as a result of his signing backing out, and it launched a lawsuit against the Spaniard in October 2023.

The reigning IndyCar champ and 2025 Indy 500 winner arrived in London for the lawsuit this week. After McLaren lawyers branded him a "serial contract breaker," Alex Palou's lawyers hit back hard, accusing McLaren Racing CEO Zak Brown of enticing their client with the promise of an F1 seat, only to sign Oscar Piastri later.

"Zak Brown enticed Mr Palou to leave Chip Ganassi and join McLaren with no greater regard to the contractual obligations, as it is alleged Mr Palou had. He did so in his typical style of negotiating, playing drivers and teams against each other. He was able to convince Mr Palou if he joined McLaren, he could really get into an F1 seat," said Palou's lawyer Nick de Marco KC (via Motorsport Magazine).

Elaborating on the deception by Brown, he added:

"Almost as soon as Mr Palou was posting his delight, he discovered Oscar Piastri was posting a similar message, having been recruited by McLaren from Alpine. It became apparent that Mr Palou had made a mistake by joining McLaren. He felt he had been deceived by Zak Brown leading him on to believe he would be promoted to F1 when that was likely never Zak Brown's intention."

Nick de Marco went as far as to call Arrow McLaren a "second-class team" to justify the alleged breaking of the F1 promise by Brown.

"The only reason he contemplated joining a second-class team was that his main interest was to go to F1 with the team of many successful drivers," the court was told.

What McLaren's lawyers said about Alex Palou's "deliberate" breach of contract and ignoring Zak Brown's calls

McLaren expected a significant gain in its IndyCar operations after signing Alex Palou, who was already a champion. Back then, Arrow McLaren was still a relative newbie in the premier American open-wheel racing series compared to the Spaniard's then-team, Chip Ganassi Racing.

If not for the alleged F1 promise, there seemed to be no reason for Palou to leave a championship-winning organization immediately after his first title. When he eventually breached the contract to stay with CGR, McLaren claimed that it cost them $30 million in sponsorship loss and additional driver contracts.

Zak Brown at the F1 Qatar Grand Prix - Source: Getty

Primary sponsor NTT renegotiated its contract, with a $7,266,902 contraction in sponsorship fees. Moreover, the Zak Brown-led team also claimed that it lost $15,564,970 in sponsorship fees from NTT for its F1 program. Additional losses included $5.5 million from other sponsors and $1 million in performance-based bonuses the team assumed it would've gained had Alex Palou raced for them. Star driver Pato O'Ward was also given a pay raise to avoid losing him after Palou.

In documents lodged with the court, McLaren stated:

"Mr Palou's recruitment promised an era of increased success for McLaren, both on and off the track. Mr Palou's signing resulted in sponsors entering into contracts with McLaren on the basis that he would be driving for the team. Yet, late in the 2023 season, Mr Palou cynically decided that a big-money offer to stay with CGR was more important than honouring his contract with McLaren."

"At the same time as he was talking enthusiastically to Zak Brown of McLaren about their future together, he was signing a new contract with CGR behind McLaren's back. Mr Palou then went into hiding, refusing to return Zak Brown's calls."

The statement further said that McLaren was "plunged into crisis mode" because of Alex Palou's "deliberate breach of contract."

On the pure racing front, Palou's decision to stay with Chip Ganassi Racing paid off to the tee. He won three more IndyCar championships with the team, the 2025 Indy 500, and recorded one of the most dominant seasons the series has ever seen in 2025.