Top clubs fear bills running into millions for Premier League legal battles

Exclusive: Clubs worried multiple cases with ‘eye-watering’ costs – including charges against Man City – will reduce their share of funding

Premier League clubs are concerned that the legal bill for all the league’s high-profile cases, including that against Manchester City, will run into multiple millions of pounds and will reduce the clubs’ share of the central funds from the broadcast and commercial deals.
The 20 clubs meet on Thursday with the Premier League commission hearing over City’s charges, more than 100 in total, ongoing and an announcement imminent on a separate arbitration with the same club. There have already been cases pursued on breaches of financial controls with Everton, Nottingham Forest and Leicester City, including appeals.
The recently published account of the appeal by the Premier League over its costs award in the Everton case for a breach of profit and sustainability rules (PSR) caused concern among the clubs. In submissions to the commission, the club’s general counsel, Celia Rooney, described as “eye-watering” some of the rates paid by the Premier League for its legal costs.
The Premier League regards the spending on fighting legal cases as fundamental – both to enforce rules and also to defend itself against legal challenges.
Those costs are paid out of central Premier League funds which means that all clubs bear them equally. In the City case alone, which is expected to last nine weeks, the Premier League has instructed two KCs from Blackstone Chambers as well as Jason Pobjoy of the same chambers, who led the league’s Everton costs appeal case. The Premier League is up against very well-resourced legal teams on the clubs’ side, including City who are led by Lord Pannick KC.
The arbitration is a separate case that culminated in a two-week hearing in June. That concerned itself with the rules governing associated-party transactions, deals between clubs and commercial partners which are owned or controlled by the same entity. The rules were introduced in December 2021 in response to the Saudi-led consortium takeover at Newcastle United and to ensure what the league describes as fair market value.
While clubs have been keen to have PSR enforced in a recent run of cases that has seen clubs rein in spending, the cost has been considerable in terms of legal cases. In the Everton case, the Premier League applied for the club to pay costs of £4.9 million but was awarded just £1.7 million and lost its appeal against that award, which added to costs.
Leicester successfully appealed against the Premier League’s jurisdiction to bring the case of a PSR breach against them. The club successfully argued that it could not be proved it was still a member of the Premier League at the point it breached the permitted losses threshold. Clubs were in disbelief that the appeal board accepted the arguments and that the spirit of the rules should be ignored.
This is the final season for the current three-year rights cycle worth more than £10 billion in total. The next domestic rights cycle, starting next season and sold to Sky Sports, TNT Sports and the BBC, for the Match of the Day highlights, is for four years.
Clubs are paid an equal share and a merit payment for both domestic and international rights, as well as additional “facility fees” according to how many of their games are shown live. They share the central commercial rights equally. In the most recently published figures for the 2022-2023 season, around £2.8 billion was paid out after solidarity and charitable deductions. Manchester City were in first place, earning around £176 million with last-place Southampton earning £104 million.
Legal costs have multiplied since then. Everton had a 10-point sanction last season reduced to six in February and were then given an additional two-point deduction for a second PSR breach. In May, Forest’s appeal against a four-point deduction for a PSR breach was rejected.