The NSNO Everton Forums

American Evertonian wrote: ↑Mon Feb 26, 2024 1:27 pm https://resources.premierleague.com/pre ... 260224.pdf

The reasoning is in here but I don’t want to read 61 pages. If any of y’all want to I would love a synopsis.

Section 83 wrote: and (iii) the loss to the Club when it decided not to sue Player X whose contract was terminated following his arrest in relation to alleged sexual misconduct with a child.

Section 105 wrote:The Club lost the services of Player X. Player X was, at the time of his arrival, the Club’s record signing, and he was a successful and popular player. However, in Summer 2021, he was arrested on suspicion of child abuse and was suspended by the Club and then the FA. The circumstances of his suspension meant that the Club was entitled to terminate his contract which, on 23 August 2021, it did. In terms of the Club’s P&L Account (and, hence, the PSR Calculation) that resulted in the net book value of the player (£9.1m) being written off, and additional losses of £0.9m for wages paid to the player for the period before 23 August 2021 when he could not provide any contractual services because of his suspension. The Club also lost the services of Player X on the pitch. Whilst the Club was advised that it had an economically viable claim against Player X, it did not pursue it because of concerns about his psychological well-being. The charges against the player were ultimately not pursued.

Toshyboy wrote: ↑Mon Feb 26, 2024 1:56 pm Would hope this kills Luton’s spirit a little too

Russian Sanctions

98. Mr Moshiri’s evidence was that he hoped Mr Usmanov would invest heavily in an
equity stake in the Club. The Club had already, on 7 January 2020, entered into
an option and naming rights agreement for the Club’s training facility and new
stadium with USM, Mr Usmanov’s company. This was to take effect from Season
2024-25, i.e. after the stadium had been opened; but, Mr Moshiri said, negotiations
had reached an advanced stage to bring this forward to FY22, so that the naming
rights sponsorship of £10m per season would commence during the construction
phase in that financial year. The possibility of this revenue in FY22 was lost, he
said, because of the sanctions imposed on Russian entities, including Mr Usmanov
and USM, as a result of the invasion of Ukraine; which meant that the Club had to
withdraw from further negotiations with him. This loss of chance, it was submitted,
should have been taken into account by the Commission as mitigation.

99. However, in the Commission’s view, this was not a head of mitigation upon which
the Club could successfully rely to reduce the penalty. It did not diminish the Club’s
culpability because (i) the prospects of an agreement being concluded were
uncertain, no documents having been adduced which showed that receipt of
monies was probable (paragraph 124); and (ii) the loss of a proposed agreement,
even if the agreement had been likely, was “no more than the type of event that
businesses have to contend with as part of their daily life” (paragraph 125).

100. As to (i), Mr Rabinowitz referred us to Board Minutes for both the Club and Everton
SDL in January 2022, which indicate that legal work had been done on the naming
agreement, which it seems needed to be signed before third-party senior debt was
obtained; and they were waiting for Mr Moshiri’s instruction. We know that Russia
invaded Ukraine on 24 February 2022 and sanctions were imposed shortly
afterwards. The naming agreement had not been concluded by then. In our view,
on the evidence the Commission was entitled to say – and cannot be criticised for
saying – that “no documents [had] been adduced which showed that receipt of
monies [from this source in FY22] was probable”. The Commission was in the best
position to make this finding on the evidence.

101. But, in any event, as regards (ii), whilst we accept that, in certain circumstances,
the loss of a chance might be a mitigating circumstance, as we have described,
the Commission approached the issue of mitigation correctly, and was entitled to
find (as it did) that the circumstances in respect of the loss of any chance so far as
Mr Usmanov/USM paying £10m in FY22 was concerned, was not such as to tend
to reduce the Club’s culpability in respect of breaching the PSR Rules. In our view,
on the multi-factorial assessment of the evidence which it conducted, the
Commission was entitled to conclude that this did not constitute a mitigating factor.
In particular, we consider that the inherent uncertainties of whether any money
might have come from this source in FY22 to which the Commission referred, were
in themselves capable of reducing any weight of this as a mitigating factor very
substantially and may alone have rendered it insignificant.

102. These uncertainties are compounded here because the existing agreement made
between the Club and USM was not one which would have provided an additional
£10m in the relevant year but for the invasion of Ukraine. There was, at best, only
the chance that a re-negotiated agreement might have done so.

103. Thus, in our view, the argument in mitigation could be put no higher than that, had
that chance (itself filled with other uncertainties) been fulfilled, then there would
have been somewhat less of a breach (but still a significant breach). That is not a
basis for a mitigating factor of any real weight.

104. However, we consider this ground of appeal fails for a shorter reason, emphasised
by the Commission in paragraph 124 of its Decision. Whilst the precise
circumstances of the loss of this chance of sponsorship (i.e. as a result of sanctions
imposed on Russia as a result of its invasion of Ukraine) might not have been
foreseeable, for any PL club, the loss of such chances during the course of a
season is sufficiently foreseeable and a contingent risk against which, if a club acts
with financial prudence as the rules require, the club should properly guard and
steer a financial course that does not result in a breach of the PSR if such chances
do not come to fruition as hoped or even expected.