Arsenal take legal action to ensure ability to sue Man City

Arsenal are among four Premier League clubs to have taken legal action as they prepare for potential compensation claims against Manchester City, should the reigning champions be found guilty of breaching financial rules.

Arsenal, alongside Manchester United, Liverpool, and Tottenham Hotspur, have formally registered their intent to seek compensation via arbitration. City face 115 charges related to financial misconduct, with no verdict expected until the new year. City deny all accusations.

The decision by Arsenal and the other clubs comes amid fears that waiting for an official verdict could leave their compensation claims outside the applicable time frame according to an exclusive in Thursday’s edition of The Times. The claims are being made under Premier League Rule X, which permits such disputes to be arbitrated rather than being settled in court. This pre-emptive move is a response to legal advice that emphasised the risk of claims being considered out of time if they waited for a conclusive ruling from the independent regulatory commission.

Rivals target City damages EXCLUSIVE Martyn Ziegler - Chief Sports Reporter Four of Manchester City’s main rivals have lodged legal notices reserving the right to seek compensation if the club are found guilty of serious charges among the 115 alleged breaches of Premier League financial rules. Manchester United, Liverpool, Arsenal and Tottenham Hotspur took the step of formally registering possible compensation claims via arbitration before a potential statute of limitations deadline last week, sources have told The Times. The clubs involved all declined to comment. The charges against City are still being heard by an independent regulatory commission, with the outcome not expected until the new year. The commission can make an order for compensation to be paid but it is understood that, because of laws around time limits to register such claims, there was concern among the clubs that it would be too late to wait until the case had been resolved. Chelsea are not believed to have lodged a legal notice relating to compensation. They have their own Premier League investigation to contend with after they self-reported alleged irregular payments during the Roman Abramovich era. That could also lead to compensation claims from rivals but there is no looming deadline for the case. The compensation notices were served after the four clubs were advised by lawyers there was a potential sixyear statute of limitations period dating from November 5, 2018, when the German website Der Spiegel first published the Football Leaks documents. Although City’s alleged rule breaches date from 2009, the 1980 Limitation Act’s six-year period for legal claims for breaches of contract in the UK allows an exception where that breach has been concealed. That would allow the sixyear period to begin when details of the alleged breaches were made public. If the charges against City are proven, clubs could claim for loss of income for missing out on the title, and qualification for the Champions League or other European competitions, which could total hundreds of millions of pounds. Clubs cannot sue each other through the courts under Premier League rules but they can do so through arbitration under Rule X. Five clubs applied for compensation when Everton were sanctioned for breaching profitability and sustainability rules last season — Leeds United, Leicester City, Nottingham Forest, Burnley and Southampton — but those claims have since been withdrawn or are unresolved. In the City case, lawyers are understood to have advised clubs that if they waited until the outcome of the hearing, there was a risk any compensation claim could be deemed to be out of time. City’s alleged rule breaches include not providing accurate financial information for nine separate seasons, not providing full details of Roberto Mancini’s pay over the four seasons he managed the club (from 2009 to 2013), and not providing full details of players’ remuneration — including for the former midfielder Yaya Touré — over six seasons from 2010-11 to 2015-16. City have also been charged with not co-operating with an investigation and failing to hand over documents over five seasons from 2018-19 to 2022-23. The Premier League investigation into Chelsea did not become public until a story appeared in The Times in June 2023, so rival clubs should have until June 2029 to file any compensation notices. Alleged irregular payments between 2012 and 2019 are under investigation, including those connected to the transfers of Willian, Samuel Eto’o and Eden Hazard. The investigation was opened after the Todd Boehly/Clearlake consortium bought the club in May 2022 and reported the payments to the league and Uefa. — The Times, 14 November 2024

The legal manoeuvres are seen as part of a broader divide across the league, with Manchester City viewing the actions of Arsenal, Manchester United, Liverpool, and Tottenham as an orchestrated vendetta against them. While none of the clubs involved have commented publicly on the arbitration notices, it’s understood that they acted before a potential statute of limitations cut-off. The legal advice they received pointed to a possible six-year deadline, dating from November 2018, when allegations against City first surfaced following the Football Leaks revelations by German publication Der Spiegel.

If Manchester City are found guilty of the alleged breaches, Arsenal and their rivals are poised to pursue compensation for financial losses relating to missed opportunities, including lost revenue from league finishes, Champions League qualification, and other revenue streams, which could amount to hundreds of millions of pounds. The charges against City include failing to provide accurate financial information for multiple seasons, concealing managerial payments during Roberto Mancini‘s tenure, and not disclosing full player remuneration details. Additionally, City have been accused of non-cooperation with the ongoing investigation, including a failure to provide necessary documents over several years.

Arsenal’s pursuit of legal action is particularly relevant given their performances between 2009 and 2016, a period in which they consistently finished in the top four under manager Arsène Wenger. Their highest league finish in this era was second place in the 2015-16 season, behind Leicester City. The allegations against City, which cover financial irregularities dating back to 2009, imply that unfair competitive advantages could have affected the standings and financial outcomes of Arsenal and other top clubs.

The potential for compensation claims also echoes last season’s actions against Everton, where several clubs, including Leeds United and Leicester City, lodged claims after Everton were sanctioned for breaching financial rules. Although those claims have since been withdrawn or remain unresolved, they set a precedent for this latest move against Manchester City. Arsenal’s decision to act now ensures that, should City be found guilty, they are well-placed to argue for financial recompense for what they perceive as lost opportunities directly related to City’s alleged misconduct.