A judge in England has awarded McLaren Racing more than $12 million in its lawsuit against INDYCAR star Alex Palou.
McLaren Racing originally asked for $31 million in damages after Palou backed out of a contract he signed in 2022 to drive for McLaren from 2024-2026. Palou, who signed a deal to remain at Chip Ganassi Racing in 2023, had already admitted a breach of contract. The six-week trial last fall in England only determined the damages.
Palou won the INDYCAR title in 2021, 2023, 2024 and 2025. His most recent title was the most dominant, as he won eight of the 17 races. He indicated in court documents that he opted to stay at Ganassi when a Formula 1 ride wasn’t guaranteed.
Alex Palou, who won his fourth INDYCAR title in 2025, was ordered to pay $12 million to McLaren for packing out of his contract.
“The court’s decision shows the claims against me were completely overblown,” Palou said in a statement. “It’s disappointing that so much time and cost was spent fighting these claims, some of which the Court found had no value, simply because I chose not to drive for McLaren after I learned they wouldn’t be able to give me an F1 drive.
“I’m disappointed that any damages have been awarded to McLaren. They have not suffered any loss because of what they have gained from the driver who replaced me. I am considering my options with my advisors and have no further comments to make at this stage. I look forward to the upcoming season with Chip Ganassi Racing.”
His current INDYCAR owner, Chip Ganassi, is covering Palou’s legal fees in the case.
“Alex has our full support, now and always,” Ganassi said. “We know the character of our driver and the strength of our team and nothing changes that.
Alex Palou (R) and team owner Chip Ganassi celebrate after one of his many wins in 2025.
“While we respect the legal process, our focus is exactly where it should be: on racing, on winning, and on doing what this organization has always done best, competing at the highest level.”
McLaren claimed it had to increase salaries of other drivers after Palou opted not to race for the team in INDYCAR and also lost close to $23 million in sponsorship from NTT on both the INDYCAR and Formula 1 sides, as well as $5.488 million in possible other sponsorship and more than $1 million in INDYCAR purse money.
The ruling by Justice Simon Picken awards more than $6 million in the loss of the NTT sponsorship, $2-$2.5 million in potential additional sponsorship (the exact amount to be determined), $2.05 million in performance-based revenue and close to $2 million in other damages related to INDYCAR salaries and payments from General Motors.
“This is an entirely appropriate result for McLaren Racing,” McLaren Racing CEO Zak Brown said in a statement. “As the ruling shows, we clearly demonstrated that we fulfilled every single contractual obligation towards Alex and fully honored what had been agreed.
“We thank the court for recognizing the very significant commercial impact and disruption our business suffered as a result of Alex’s breach of contract with the team.”
All the damages were associated with the INDYCAR portion of the contract and nothing on the Formula 1 side.
