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'Secret lawyers say' - Kieran Maguire provides update on Everton's legal case against Burnley

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Burnley are seeking compensation from Everton after suffering Premier League relegation in the 2021-22 season.

Everton could come to a settlement with Burnley out of court, suggests football finance expert Kieran Maguire.

The Clarets are seeking compensation from the Toffees in relation to the 2021-22 season. Burnley were relegated from the Premier League, with Everton avoiding the drop to the second tier. However, the Blues were subsequently found guilty of breaching profit and sustainability rules (PSR) and were hit with an eight-point deduction last campaign. Everton also had two points docked for failing to meet spending regulations in 2022-23.

Burnley are seeking compensation for a loss of earnings, with TV revenue markedly less in the Championship compared to the top flight. It is suggested that the Lancashire outfit will argue they would have remained in the Premier League had Everton not overspent.

But Maguire, speaking on his podcast The Price of Football, says that lawyers he has spoken to believe Burnley may not be able to prove that claim. Three players who were signed in the January transfer window of the 2021-22 season, Nathan Patterson, Dele Alli and Donny van de Beek, had little impact as Everton secured survival under then-manager Frank Lampard.

What’s been said

Maguire, a lecturer at the University of Liverpool, said: “It looks as if Burnley's legal counsel feel they have a case. They can't reverse the table return to the Premier League so it looks as if they will seek some form of financial redress. They will claim presumably had Everton not been in a position where they breached PSR, they would not have been able to sign all of the players or keep all of the players they had had that season. Therefore, they would have generated fewer points and Burnley could have avoided relegation.

“I've spoken to some of our secret lawyers and they say it's not something you can prove because Everton could have signed some duffers on big salaries that season. That will be part of their defence and it will be very difficult to quantify the impact of an individual player in terms of points and so on. Are there precedents? Yes there are.

“If we go back to 2005 when Sheffield United were relegated, they put in a similar claim following the [transfers of] Carlos Tevez and (Javier) Mascherano, who were signed by West Ham. It was subsequently, I think, proven that there had been third-party ownership of those two players, which was a breach of the rules.

“Sheffield United claimed that they had suffered indirectly as a result of this because they were relegated and West Ham weren’t. Nobody knows the exact amount that was paid across at the time but it was rumoured to be somewhere in the region of £20m.

“Now, £20m in 2005, if you look at the size of the TV deals and how they have grown since then, it is clearly much more significant than that. The secret lawyers that we had a chat with said you can’t say you’ve got to, therefore, give the difference between Premier League TV revenues and what you’re getting in the Championship because there still was a 100 per cent chance that Burnley would have survived and so on.

“But there is a case and there is also, of course, a defence, and clearly Everton will be defending this using their knowledge and their counsel’s view. I suspect we will have an out-of-court settlement, we won't get to hear the results. Are there any other precedents? Middlesbrough petitoned against Derby County when they missed out on a play-off place. They said Derby breached PSR when Derby were in administration. It was rumoured [former owner] Mel Morris settled this personally. We have had these cases take place and clearly Everton are in a much better place than previously.”