Parramatta Eels being sued for more than $1 million over 2016 cap scandal

Parramatta is pushing to qualify for its first grand final in more than a decade and the last thing they need is this off-field distraction.

ROCKHAMPTON, AUSTRALIA – SEPTEMBER 12: Waqa Blake of the Eels jumps in his teammates as Mitchell Moses of the Eels celebrates with his teammates after scoring a try during the NRL Elimination Final match between Parramatta Eels and Newcastle Knights at Browne Park, on September 12, 2021, in Rockhampton, Australia. (Photo by Albert Perez/Getty Images)

Parramatta’s bid to qualify for their first grand final in more than a decade will be played with a million-dollar law suit simmering in the background.

News Corp revealed last month that the Eels were being sued by the liquidators for BlackCitrus, one of the companies caught up in the 2016 salary cap scandal.

It can now be revealed that the liquidators are suing the Eels for more than $1 million amid claims of unpaid invoices and interest.

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Waqa Blake leaps as he joins teammates as they celebrate a try in their elimination final win against the Newcastle Knights.

The Eels have lodged a defence in which they accuse former chief executive Scott Seward of signing a heads of agreement with Blackcitrus without the knowledge of the board and in breach of his duties to the club.

Seward was charged by police for his role in the cap scandal, which eventually cost the club 12 points and fines of $1 million.

The matter appeared dead and buried but has reared its head on the eve of the finals after it emerged that liquidators for Blackcitrus were chasing money they believed the company was owed by the Eels.

The NRL’s final determination into the Eels salary cap scandal found that the club had made as series of third-party agreements via ScoreCube — a subsidiary of Blackcitrus — in contravention of the game’s rules.

Ex-Eels boss Scott Seward was charged by police at the time for his role in the cap scandal.

Eels Will Penisini and Blake Ferguson during their winning weekend in Rockhampton.

In total, $225,000 was scheduled to be paid to former players Jarryd Hayne and Anthony Watmough via ScoreCube Pty Ltd. There is no suggestion Hayne or Watmough did anything wrong.

According to the Eels’ defence, they claim that Seward signed a heads of agreement with Blackcitrus without the knowledge of the board at the time.

They also claim that Seward did not have authority in his capacity as chief executive to execute the heads of agreement on behalf of the Eels in circumstances where it “was a sham and the true purpose of the arrangement was to provide payments to player Anthony Watmough in avoidance of the NRL salary cap rules”.

The Eels claim that Blackcitrus was aware that the agreement was a sham. Third party agreements scheduled to be paid to Watmough and Hayne were among those listed in the findings of former NRL chief executive Todd Greenberg when he haded down his decision in the Eels’ salary cap scandal.

The Eels will take on the Panthers on Saturday night to keep their grand final ambitions alive.

“In these circumstances the lodgement of each of these third-party agreements for registration with the salary cap auditor is in substance a false representation that is made by the club that the agreements were arm’s length agreements which complied with the requirements of the PCR (player contracting rules) and therefore were suitable for exclusion from the salary cap calculation,” Greenberg wrote.

“The making of these representations is conduct of representatives of the club that has the purpose of subverting the PCR rules.”

The law suit is an unwanted distraction as the Eels attempt to qualify for their first grand final since the 2009 decider against Melbourne. To get there, they must first find a way past their western Sydney enemies Penrith on Saturday night.

Parramatta will head into the game as outsiders, having struggled to beat Newcastle at the weekend. Penrith are coming off a shock loss to South Sydney and the winner will play Melbourne for the right to play in the grand final.