Rugby Australia to counter-sue in dispute with Melbourne Rebels / Photo: William WEST - AFP
Rugby Australia to counter-sue in dispute with Melbourne Rebels
Rugby Australia said Thursday it was preparing a counter-claim against axed Super Rugby club Melbourne Rebels, alleging misleading and deceptive conduct in an increasingly bitter legal dispute.
The move came after Rebels' directors lodged a lawsuit this week against the governing body in Australia's Federal Court, demanding Aus$30 million (US$20 million) in damages to cover debts owed.
It followed RA reclaiming the debt-ridden club's playing licence this year and shutting it down after 14 seasons in Super Rugby, opting against a rescue deal.
In a scathing statement, RA said it rejected the directors' "ambit claims and attempts to shift blame for their financial mismanagement".
"RA is preparing a counter-claim against MRRU (Melbourne Rebels Rugby Union Pty Ltd) and its directors for misleading and deceptive conduct concerning the financial position of MRRU dating back to 2018," it said.
"Based on that misleading and deceptive conduct, RA granted MRRU a participation licence for the Super Rugby competition and provided associated funding and payments to MRRU.
"Had RA not been misled or deceived, it would not have provided MRRU with a participation licence and thus not lost in excess of $35 million that was paid to MRRU since at least July 1 2018."
The Rebels went into voluntary administration in January with debts exceeding Aus$23 million, much of it to the tax office.
Administrators found the club may have traded while insolvent since 2018, but recommended creditors accept a plan put forward by a private consortium to fund it until 2030.
Instead RA, which stepped in to keep the club afloat for the 2024 season, paying player and staff wages, said it had "significant doubts" over the funding model and shuttered the club in May.
Their demise left Super Rugby with 11 teams ahead of the new season, which is due to kick off in February.
K.R.Jones--EWJ
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