Everton have been told they must pay Burnley £35m over the impact of breaches of the Premier League's financial rules.
The case - heard by a Premier League commission - relates to the 2021-22 season, when Everton were found to have broken profit and sustainability regulations (PSR) over a three-year period.
Burnley argued the breach impacted their chances of staying in the Premier League, and sought compensation for the losses associated with being relegated.
The Clarets have been awarded £26m in damages and a further £9m in interest.
Everton have appealed, with sources saying they will "robustly and thoroughly" contest the ruling.
The club said in a statement they were "clear in the belief the ruling is fundamentally flawed in both law and fact".
"This ruling sets a dangerous and unworkable precedent for English football, given it is constructed on a principle that a club can be in breach of financial rules at any point in a financial year," the statement said.
"Everton believes the panel's ruling misrepresents the clear evidence presented by its legal representatives and that an appeal will be successful."
Both clubs presented evidence from experts to simulate the effect of the overspend on Everton's points total.
The commission said that it found Burnley's evidence, which projected a gain of between 3.85 and 7.13 points for the Toffees, "more compelling".
It added that "on the balance of probabilities, Everton's breach of the PSR caused Burnley to be relegated".
Any compensation payment would not impact Everton's PSR accounts for the current period.
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