Key facts
- Everton is appealing a £40 million ruling that found their spending breaches caused Burnley's 2022 relegation.
- An independent commission determined Everton's breaches denied Burnley a fair chance to avoid relegation.
- Everton stated the ruling is fundamentally flawed and sets a dangerous precedent.
- Burnley argued Everton's financial rule breaches deprived them of a chance to remain in the top flight.
- Everton finished the 2021-22 season in 16th place, four points above Burnley.
Everton has announced an appeal against a ruling that requires them to pay £40 million to Burnley following a legal dispute over the latter's 2022 Premier League relegation. The club expressed surprise and anger at the decision from a Premier League independent disciplinary commission.
Everton stated that the ruling is fundamentally flawed and does not recognize the commission's determination that their breach of Profit and Sustainability Rules provided Burnley with a substantive sporting advantage. The club believes this sets a dangerous precedent, as it implies a club can be in breach of financial rules at any point within a financial year. Everton asserts that the panel misrepresented the evidence presented by its legal team and expects a successful appeal.
Industry observers suggest this verdict could prompt other clubs to seek financial compensation from rivals found guilty of rule breaches. Potential ramifications could extend to Manchester City, whose dispute with the Premier League is ongoing, and Chelsea, who previously faced penalties for admitting breaches under prior ownership.
Burnley's argument centered on the "loss of chance" principle, contending that if Everton's punishment had been applied during the season it occurred, Everton would have been relegated instead of Burnley. Everton finished the 2021-22 season in 16th place, four points above Burnley. The damages awarded to Burnley reportedly incorporate interest, calculated by multiplying the money at stake by the chance of success.
This follows Everton's prior sanction of a 10-point deduction for breaching profitability and sustainability rules in 2021-22, which was later reduced to six points on appeal in 2024. The last successful instance of a relegated club suing a rival for rule breaches occurred in 2009 when West Ham settled with Sheffield United for approximately £20 million.