Burnley believe that, had Everton's first points deduction been imposed in the season the breach took place, the club would have avoided relegation
Everton's fans invade the football pitch to celebrate the win over Crystal Palace that secured Premier League survival in May 2022. Photo by Oli SCARFF/AFP
Everton's fans invade the football pitch to celebrate the win over Crystal Palace that secured Premier League survival in May 2022. Photo by Oli SCARFF/AFP
Everton are set to defend themselves against a compensation case pursued by Burnley over their relegation from the Premier League in 2022. The Clarets are thought to be seeking in excess of £50m - money they claim they lost after falling out of the top flight that year.
Everton were later deducted six points for financial breaches relating, in part, to that season.
Burnley's case will likely centre on the premise that, had the punishment been applied in the same campaign as the breach, they could have stayed in the Premier League at the expense of the Blues. That position is now set to be tested in a hearing scheduled to begin this week at the International Dispute Resolution Centre for Arbitration and Mediation in London.
The case is rooted in the first league prosecution of Everton for breaches of its Profitability and Sustainability Regulations (PSR).
The Blues were handed a 10-point penalty in November 2023 in what was then a landmark judgement - the club being the first to go through the full process for a breach of PSR.
The deduction, which related to the three-year assessment cycle that concluded in the summer of 2022, was later reduced to six points on appeal.
Burnley, the highest placed of the relegated clubs, finished four points behind Frank Lampard’s Blues, who stayed up courtesy of a dramatic comeback win against Crystal Palace at Goodison Park in the penultimate match of that season.
While the points deduction was not applied in the same season as the breach, Premier League law at the time did not require matters to be determined in the one season. That has since changed.
Everton would likely argue they operated within the Premier League’s legal framework that existed at the time.
Burnley suffered a £58m drop in revenue as a result of their relegation. The club could potentially claim for the financial impact of a loss of a portion of Premier League broadcast rights and the diminution in value of commercial deals as a result of their relegation.
They would need to be able to show the Blues received a direct sporting advantage as a result of the circumstances of their breach.
The case will be heard in private. While its outcome may never be made public, it could have significant implications.
Success for the Clarets could pave the way for further compensation claims should other clubs be found to have breached rules. That is pertinent with a verdict due in the complex legal battle between the Premier League and Manchester City.
Everton and the Premier League declined to comment. Burnley were approached for comment.
While the Blues were the first to be deducted points for a PSR breach, the club was not the last.
Both Everton and Nottingham Forest received penalties in 2024 for breaches that related to the assessment cycle that ended in the summer of 2023.