Liverpool could be loser in expensive Premier League and Man City legal battle

The Premier League shelled out more than $60 million on legal expenses last season in its bid to uphold its regulations.

Teams like Liverpool are now apprehensive that the league's ongoing battle with Manchester City could directly impact them, as the legal fees will be deducted from the organization's central fund.

The league is currently entangled in two separate legal disputes with the four-time consecutive champions, and is also probing Chelsea regarding alleged irregular payments tied to the club's ex-owner Roman Abramovich.

The significant City hearing - involving 115 individual alleged violations of the Premier League's financial rules, spanning nine years from 2009 - has finally commenced. However, the process, including potential appeals, is set to be protracted and the Premier League is bracing for a substantial legal bill, even if they emerge victorious.

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Additionally, there have been legal cases related to its profit and sustainability rules (PSR) involving Everton and Nottingham Forest, who were penalized with point deductions last season, and Leicester who will no longer face an independent commission over an alleged breach. The legal bill for the case against Everton escalated to as much as $6.5 million.

Everton were instructed to pay $2.3 million, while the remaining $4.3 million was covered by the Premier League. It's understood that these costs are included in the information dispatched to clubs ahead of Thursday's Premier League shareholders meeting in central London.

Teams such as Liverpool are now left in a state of apprehension, fearing that the ongoing legal battles could lead to a decrease in their share from the league's lucrative broadcast and commercial deals. Tony Scholes, the league's chief football officer, is set to present data on refereeing and VAR from the season's initial weeks at the meeting. Despite criticism from top-flight managers, it is anticipated that this will paint a more positive picture.

Scholes will also update on the testing of new semi-automated offside technology, which clubs unanimously agreed to implement at some point during the current season back in April. The plan was to introduce this after one of the autumn's international breaks, with the next one scheduled for October.

There are also whispers that a decision regarding City's challenge to the league's associated party transaction (APT) rules is on the horizon. While league rules prevent the arbitration panel's decision from being announced, clubs would expect to be kept in the loop by the league if the outcome has any bearing on the current rulebook.

The APT rules aim to ensure that commercial deals with entities connected to a club's owners are conducted at fair market value. This meeting marks the first since an appeal panel ruled in favor of Leicester in their dispute with the Premier League over an alleged PSR breach.

The appeal panel accepted Leicester's argument that an independent commission set up under Premier League auspices did not have jurisdiction to hear the case because the club was in the Championship at the time the final set of accounts in their PSR calculation were published. There has been speculation the decision could prompt a rewrite of the rules, but a similar situation could not occur again until next summer at the earliest.

Clubs are also set to discuss the first weeks of the new 'shadow' financial regulations, which are intended to come into force next season. These include the Squad Cost Rules (SCR) which limit spending on squad-related costs at 85 percent of revenue, and top-to-bottom anchoring (TBA) which effectively creates a spending cap set as a multiple of the central revenue paid out to the league's lowest-earning club.

Manchester United and Manchester City are among the clubs who oppose the principle of anchoring, while the players' union the Professional Footballers' Association has instructed sports barrister Nick De Marco KC to act on its behalf in its dealings with the Premier League on this subject.

De Marco was part of the legal team involved in Leicester's recent PSR appeal success and helped force the withdrawal of a salary cap in the EFL. The PFA has said it will oppose any measure which it feels amounts to a salary cap.

The first shareholders meeting since the Labour landslide in July is set to take place, with the hot topic of an independent regulator on the agenda. Culture Secretary Lisa Nandy has already indicated that the Football Governance Bill will return to Parliament "within a matter of weeks".

The Premier League maintains that a light-touch approach to legislation is the way forward. Thursday's gathering also marks a chance to revisit the 'New Deal' discussions with the EFL, which have been paused since March.