One of Australia’s biggest sporting codes is hit by bombshell $30million lawsuit that could spell financial disaster

The Melbourne Rebels are seeking $30 million from Rugby Australia in a lawsuit launched after the governing body dissolved the club.

In a lawsuit filed in the Federal Court on Wednesday, the club seeks a declaration that it can regain control of the Rebels so that the team can continue playing in the Super Rugby competition.

“The Rebels are members of Rugby Australia and had a legal expectation that they would not only be treated fairly but would also be treated the same as other members,” the club said in a statement.

“Among other things, the rebels will claim that Rugby Australia has breached various sections of the Corporations Act.”

The club is also seeking the court to order Rugby Australia to open its books for inspection to determine allegations it failed to meet the Rebels’ funding responsibilities, even when the players represented the Wallabies.

In the statement, the club said it believed Rugby Australia had made “unacceptable and unauthorized expenditure”, including during the 2023 Rugby World Cup.

The rebels claim Rugby Australia executives and directors continued to assure him and other teams that a major private equity deal would provide a financial lifeline for the sport.

“Rugby Australia secured an $80 million loan but opted only to provide funding, compensation or other financial support to the NSW Waratahs and subsequently the ACT Brumbies, in preference to the Melbourne Rebels,” the club said.

The Melbourne Rebels were sacked by Rugby Australia in May (RA CEO Phil Waugh)

The Rebels were sacked by Rugby Australia in May after entering voluntary administration five months earlier with debts exceeding $23 million.

“While this is undoubtedly a sad day for the Melbourne Rebels, the clarity this decision provides to our players and staff is welcome,” a Rebels statement read at the time.

“The club will continue to work with RA and the Rugby Players’ Association (RUPA) regarding next steps for players and staff.”

A consortium led by business heavyweight Leigh Clifford has put forward a plan to fund the club until 2030 contingent on the RA returning their licence, with promises of funding.

Rebels management also wants the team to continue playing in the Super Rugby Pacific competition.

But RA boss Phil Waugh said the identity of the consortium members had not been revealed, their credentials could not be fully assessed and the lack of details available created an “unacceptable level of risk” and the decision was made to close. the club. .

Many players and staff have since joined other clubs.

Rugby Australia has been contacted for comment.