Everton are preparing to defend themselves against a compensation claim brought by Burnley following their relegation from the Premier League in 2022. The Clarets are believed to be seeking over £50m, an amount they argue was lost due to their drop from the top tier that year.
Everton were subsequently docked six points for financial infringements partly related to that season.
Burnley's argument is likely to hinge on the idea that if the penalty had been imposed during the same season as the violation, they could have remained in the Premier League at Everton's expense. This stance is set to be examined in a hearing scheduled to commence this week at the International Dispute Resolution Centre for Arbitration and Mediation in London.
Leeds United, who also went down to the Championship that season, are understood to be watching events closely.
The case stems from the first league prosecution of Everton for violations of its Profitability and Sustainability Regulations (PSR).
In what was then a groundbreaking judgement, Everton were given a 10-point deduction in November 2023 - the club being the first to undergo the full process for a PSR breach, reports [the Liverpool Echo](https://www.liverpoolecho.co.uk/sport/football/football-news/everton-set-legal-fight-over-32487933).
The penalty, which pertained to the three-year assessment cycle ending in the summer of 2022, was later reduced to six points on appeal.
Burnley, who finished highest among the relegated clubs, ended four points behind Frank Lampard's Blues, who secured their Premier League status thanks to a thrilling comeback victory against Crystal Palace at Goodison Park in the second-to-last match of that season.
While the points deduction wasn't applied in the same season as the breach, Premier League regulations at the time didn't necessitate matters to be resolved within a single season. This has since been amended.
Everton would likely contend that they operated within the legal framework of the Premier League that was in place at the time.
Burnley experienced a £58m decrease in revenue due to their relegation. The club could potentially seek compensation for the financial impact of losing a portion of Premier League broadcast rights and the reduction in value of commercial deals due to their relegation.
They would need to demonstrate that the Blues gained a direct sporting advantage as a result of the circumstances surrounding their breach.
The case will be conducted behind closed doors. While the outcome may never be disclosed, it could have significant repercussions.
If Burnley are successful, it could set a precedent for further compensation claims should other clubs be found guilty of breaking rules. This is relevant with a verdict expected in the complex legal battle between the Premier League and Manchester City.
Both Everton and the Premier League declined to comment, while Burnley were approached for a response.
Although the Blues were the first to receive a points deduction for a PSR breach, they weren't the last.
Both Everton and Nottingham Forest were penalised in 2024 for breaches related to the assessment cycle that concluded in the summer of 2023.