Just as Everton thought brighter times were ahead of them with The Friedkin Group, Burnley have thrown a spanner in the works.
The Championship outfit are set to press forward with their legal battle to seek compensation from Everton.
Scott Parker’s side are enjoying an encouraging season in the second tier and look good to secure themselves automatic promotion.
Everton have secured top legal representation for Burnely’s case, which is set to get underway in the summer.
Financially, it has been a difficult few years for the Blues, who have found themselves on the wrong end of PSR.
David Moyes was shocked by Everton’s financial state after taking over on Merseyside back in January.
With the Toffees now set for further scrutiny over the coming months, TBR Football’s Finance Expert Adam Williams has taken a deeper dive into the case.
Photo by Christopher Furlong/Getty Images
Photo by Christopher Furlong/Getty Images
Everton set for ‘complicated’ compensation battle with Burnley
Following The Friedkin Group’s takeover in December, Everton’s finances have improved dramatically ahead of the summer transfer window.
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Everton are hoping for big revenue boosts from Bramley-Moore Dock, with the American owners keen to improve the playing squad over the coming months.
Things are looking positive for Everton off the pitch after years of worry under the watch of Farhad Moshiri.
However, Burnley are set to cast a shadow over the positive mood on Merseyside in what is set to be a huge summer off the field for the Toffees.
“Essentially, Burnley want to recover any financial losses they may have made because Everton breached the PSR threshold in 2022-23,” said Williams.
“*Their argument will be that Everton gained a sporting advantage by spending more than they were allowed to in the assessment period, which led to them staying up instead of Burnley.*“
2022-23 Finances Total
Profit/loss post-tax -£89.1m
Profit on player trading £47.5m
Turnover £172.2m
Sponsorship income £19.2m
Gate receipts £17.3m
In the 2023/24 campaign, Everton were handed two separate points deductions – which after reductions – equalled six points.
Everton finished well clear of the bottom three, which saw Burnley finish 19th, but the Clarets are unwilling to let go despite their promising form in the Championship.
“Quantifying how much cash they might have lost is really complicated. It is not just the loss of the Premier League TV money, although that is the single biggest component. Money from sponsorship also took a hit and there will be some other tangential factors too,” Williams added.
“*But for any of that to be relevant, Burnley need to convince the panel that Everton’s spending was the reason they went down – and I don’t think that will be straightforward.*“
Carlos Tevez case from 2009 may be used as Burnley argument
The Championship play-off final is dubbed the richest game in football for the finances that comes with becoming a Premier League side.
Burnley feel they have lost out on a year in the Premier League due to Everton’s over-spending, which received punishment in the form of their six-point deduction.
With the Clarets seeking financial compensation, Williams feels the Clarets could well look back to Sheffield United’s successful trial against West Ham in 2009.
“This is where we get into the bizarre situations where lawyers and grey-faced executives are casting judgement on how much this player or that signing affected the relegation battle,” he said.
“*Fundamentally, they’re arguing about something they know very little about – in relative terms, at least – and which is inherently hard to quantify. Sport and law are incompatible in that sense.*“
The Blades believed Carlos Tevez’s goals kept the Hammers afloat in the 2006/07 Premier League, despite West Ham being fined for third-party player ownership.
In 2009, West Ham agreed to pay £20m in compensation to the Blades.
“I think the fact that none of the other clubs who initially reserved the right to seek compensation have followed through shows us that it’s going to be a difficult argument to make.
“*That said, there are precedents for this. The Tevez case with Sheffield United and West Ham in the mid-2000s being the most prominent example.*“