Having already been fined a record £5.5m for breaching Premier League rules in signing Carlos Tevez and Javier Mascherano, West Ham are now faced with the prospect of paying Sheffield United millions of pounds in compensation.
Blades chairman Kevin McCabe has revealed that an independent tribunal has ruled in his club's favour as they look to gain compensation for being relegated to the Championship, rather than West Ham who were helped in their survival bid by the performances of Tevez.
BBC Sport looks at how the panel arrived at their decision and what it means for both clubs.
WHO MADE TODAY'S DECISION?
When two clubs are in dispute, then under the FA's Rule K, there is a procedure for solving disagreements through independent arbitrators.
Each club can nominate one member of a private arbitration tribunal, then together the two parties choose a third to act as chairman.
In this case, the panel was made up of Lord Griffiths, a former President of the MCC, Robert Englehart QC, and Sir Anthony Colman, a former High Court Judge.
WHY GO THROUGH THIS PROCESS?
The clubs would be in breach of FA rules if they didn't.
It can be faster and more flexible in terms of procedure than the courts, and (unlike in court) it allows the clubs to choose who will sit in judgment on their claims.
Being private, it also provides confidentiality, away from the glare of the media spotlight.
WHAT DO WE KNOW ABOUT THE DECISION?
The panel has made a decision on liability (i.e. whether West Ham breached any duty to Sheffield United, such that it should compensate Sheffield United for the loss it suffered as a result), and notified both clubs about the ruling, which has not been made public.
But they are believed to have ruled in favour of Sheffield United (i.e. they are believed to have ruled that West Ham did breach a duty to Sheffield United and should pay damages in an amount sufficient to compensate Sheffield United for the losses it suffered as a result of that breach of duty).
HOW MUCH WILL COMPENSATION AMOUNT TO?
The panel is expected to hold another hearing now to hear evidence and arguments as to how much Sheffield United should be awarded in damages. They will probably not issue any decision until the beginning of next year.
CAN WEST HAM APPEAL?
At first, it seemed they would not be able to.
The Football Association's Rule K5c states that by signing up to arbitration, "the parties shall be deemed to have waived irrevocably any right to appeal, review or any recourse to a court of law".
Yet, after taking legal advice, the Hammers board has decided to appeal to the Court of Arbitration for Sport (CAS), which is the final arbiter on sporting matters.
A leading sports lawyer explained to BBC Sport that because CAS is a tribunal and not a court of law, rule K5c would not preclude an appeal to it.
CAN THE RULING HELP GET SHEFF UTD BACK IN THE PREMIER LEAGUE?
The Sheffield United chairman, Kevin McCabe, raises this issue on the Sheffield United website - he certainly sounds like he hasn't given up hope.
But the Premier League's decision not to dock West Ham points in 2007 was scrutinised and cleared by an independent panel, and the Commercial Court rejected Sheffield United's attempt to get that award overturned.
That issue is dead. All we are talking about now is money.
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