Alex Palou ‘rolled grenade into room’ when leaving McLaren, High Court told

Racing car driver Alex Palou “rolled a grenade into the room” when he announced his plans to leave McLaren, the company’s CEO has told the High Court.

McLaren Indy LLC and McLaren Racing, which run the Arrow McLaren IndyCar team and McLaren’s Formula One team, are claiming around 21 million US dollars (£15.5 million) in losses from Alex Palou and two companies connected to him.

A trial in London was told that the 28-year-old, who has won four IndyCar championships, agreed in October 2022 to drive for McLaren in 2024, 2025 and 2026, but in August 2023 announced that he would not fulfil the agreement.

The Spaniard has since admitted breaching the contract, but disputes that he should pay damages.

In a witness statement for a hearing on Tuesday, McLaren CEO Zak Brown said Mr Palou’s departure caused “significant financial and reputational consequences for McLaren”.

He said that a lucrative sponsorship deal with IT firm NTT Data Americas had to be renegotiated because another driver of similar calibre could not be found in time.

McLaren is seeking more than 7.2 million US dollars (£5.3 million) arising from that renegotiation, as well as more than 6.8 million US dollars (£5.1 million) which it claims it will lose in other sponsorship revenue.

It is also claiming more than 1.3 million US dollars (£963,000) in additional salaries paid to other drivers of its three IndyCar cars following Mr Palou’s departure, including Pato O’Ward, the return of Mr Palou’s 400,000-dollar (£296,000) sign-on bonus, and other sums.

In his statement, Mr Brown said: “NTT entered into negotiations in the first place because they knew Alex was coming to McLaren, and the amount they were willing to pay was based on Alex driving for us.

“Had there been a less experienced driver, or a driver that was not as good, the price we agreed with NTT would not have been as high as it eventually was, or they may have decided not to partner with us at all.”

Mr Palou won the 2021, 2023, 2024 and 2025 IndyCar championships and also won the 109th Indianapolis 500 race earlier this year, making him the first Spaniard to achieve both.

He raced for Chip Ganassi Racing (CGR) in the IndyCar series before agreeing to drive Arrow McLaren’s Car 6, but then returned to CGR.

Mr Brown also said in his statement that it is “likely” Mr Palou “lied” to him in August 2023 about being excited to race for McLaren as a week later he announced through his lawyers that he would be staying with CGR.

He described this as “a real shock”, after which he went into “crisis mode” while he “knew it would cause reputational problems, and serious issues with our sponsors”.

The CEO added: “Not only did we lose a championship driver, but we have also been rotating drivers in and out of Alex’s car and dealing with injured drivers all of which has been very disruptive for our racing team.

“We should have been focusing on track performance and finding new sponsors, but you cannot focus on that when you do not know who will be in your car.”

Mr Palou’s exit caused “a big problem” for NTT, Mr Brown said, who were “shocked and disappointed”.

He continued: “Alex’s conduct not only had serious implications for McLaren’s sponsorship arrangements, but is, in my view, exacerbated by the fact that he did not even inform me as a courtesy of his decision — in a way which might have enabled me to better manage the relationships involved, including with NTT.

“Instead, Alex effectively rolled a grenade into the room and let it go off, leaving me to deal with the consequences with our sponsors.”

Lawyers for Mr Palou said last week that McLaren’s damages claim is “vastly inflated” and is a “bare-faced attempt to ‘take Mr Palou to the cleaners’”, while suggesting that McLaren has since earned more than it alleges to have lost.

Mr Palou is due to give evidence later in the trial, with his barrister, Nick De Marco KC, saying in written submissions that his client joined McLaren as it was his “motivation” to drive in F1.

Only after a “disappointment of Mr Palou’s hopes and expectations” of an F1 seat did “the breakdown of Mr Palou’s confidence in McLaren” occur, the barrister said.

Mr De Marco also said the renegotiation of the NTT deal was not “anywhere near as bad” as had been claimed and that there was “absolutely nothing” in the deal that made its terms conditional on Mr Palou driving for McLaren.

The trial before Mr Justice Picken is due to conclude in November, with a judgment expected in writing at a later date.