Manchester City could face $1 billion-plus bill as Arsenal, United, Liverpool, and Spurs to sue

Rival clubs are now lining up to pursue legal action against Manchester City.

The situation could escalate into a collective class action lawsuit as clubs seek substantial damages following City’s guilty verdict for breaching Premier League financial regulations.

Arsenal, Manchester United, Liverpool, and Tottenham Hotspur have already reserved their right to sue by filing legal notices after the statute of limitations had passed, according to The Mirror.

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The 40-page legal document published by the Premier League not only exposed the depth of the case against City but also opened the floodgates for further club litigation.

City stood accused of creating “sham” contracts, artificially inflating £900 million ($1.187 billion) worth of deals and engaging in “widespread” deception. The fraud allegations broaden the scope for backdating legal claims.

Clubs could pursue damages for missing out on UEFA Champions League qualification, while relegated sides could argue they would have retained their top-flight status had City’s financial misconduct been addressed sooner. Commercial losses also form part of potential claims.

Sports barrister Yasin Patel, of Church Court Chambers, said: “Four teams have stated they will take legal action but other teams are likely to follow suit.

“In 2013-2014 and 2014-2015, Norwich and Hull finished 18th respectively. They could argue that, had the Premier League taken action, they may not have been relegated. This is a complex argument, but it illustrates how some clubs may seek compensation.

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“If these two clubs were to make this argument, it could be said that Manchester City should not have to pay both as only one could possibly have benefitted had City been ultimately relegated.

“The clubs would have to prove that Man City’s alleged actions caused them to ultimately suffer losses due to relegation and the financial implications that followed.

“It would probably be easier for teams who were relegated to make this argument collectively rather than individually.

“The teams could also turn their wrath on the Premier League and argue that if they had done their investigations and subsequent hearings more expeditiously, then Manchester City would not have been able to continue in their actions.

“Other teams that may take actions could include those who lost out on European football, either because of Manchester City taking a Champions League spot, meaning that they ultimately were outside the European places, or because they missed out on Europe after failing to win cup competitions. In 2010-2011 and 2018-2019 this was Wigan and Watford: they too may seek compensation.”

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-Credit:OLI SCARFF, AFP via Getty Images

Estimates suggest that Arsenal, United, Liverpool and Tottenham could each be entitled to as much as £200 million ($263.9 million) in damages, stemming from missed opportunities in terms of silverware, commercial revenue and Champions League qualification.

There is a belief that the financial figure will amount to “vast sums,” especially when compared to previous individual cases. Everton were ordered to pay Burnley £35 million ($47 million) in damages after Burnley were relegated following an Everton Profit and Sustainability breach.

Patel added: “Damages are hard to predict as we do not know many clubs will seek compensation, nor whether they will seek it solely from Manchester City or potentially from the Premier League as well, allegedly failing to properly discharge its duties.

“Everton were ordered to pay £35 million to Burnley in compensation for losses suffered due to Everton’s breach of Profit and Sustainability Rules.

“The appeal is due to be heard in January. But that involves just one club. If we have 10 to 15 clubs seeking compensation, Manchester City could be looking at paying vast sums to other clubs in addition to all the legal costs that could follow.”