Report: Everton could face court battle to stay in EPL over financial breaches

Burnley and Leeds United are threatening to take legal action against Everton over suspicions the Toffees breached the Premier League's financial fair play rules, according to Martyn Ziegler of The Times.

The two clubs reportedly sent a letter to the Premier League last week asking whether it has investigated Everton for a potential breach. The Merseyside outfit recorded £371.8 million in losses over the last three years, exceeding the maximum £105 million the Premier League allows over the same period.

Burnley and Leeds reportedly suspect Everton attributed a disproportionate amount of their losses to the pandemic. Although the Premier League allowed clubs to claim losses against the pandemic, Everton's COVID-19-related deficit is three times as high as clubs of similar size and stature.

Everton announced in March the pandemic caused "at least" £170 million in losses during the 2020-21 fiscal year. For reference, Aston Villa claimed £56 million and Newcastle United declared £40 million.

The Premier League could reasonably argue Everton's estimate is high. They only pulled in around £14 million in matchday income before the pandemic forced teams to play in empty stadiums in 2020 and 2021.

A spokesperson for Everton told Ziegler they've "worked closely" with the Premier League to make sure they're compliant and that they're "comfortable" they've met all requirements.

The Premier League reserves the right to deduct points or issue fines if it finds a club has breached financial rules. A points deduction could potentially relegate Everton - who secured their status Thursday with a 3-2 comeback win over Crystal Palace - by pushing them down the standings.

Frank Lampard's side currently has an unassailable four-point cushion over Burnley and Leeds with one match remaining in the season. As things stand, it can't finish lower than 16th place.