Portsmouth have called on the Premier League to lift the transfer embargo on the club and could start legal proceedings.
Portsmouth are currently banned from operating in the January transfer window because of outstanding debts to other clubs and also had £7million of TV money handed direct to those debtors by the Premier League. But now the club are on the verge of trying to force the Premier League to relax the restrictions so they can bring in loan players to Fratton park.
"I can confirm we have issued a legal letter to the Premier League to demand that the transfer embargo should be lifted," chief executive Peter Storrie told the Sunday Mirror.
"We believe we've a very good case against them. They have absolutely no right to withhold TV money in advance of future payments or payments to foreign clubs."
There are fears Pompey's dire financial situation could force them into administration.
They have failed to pay their players' wages on time on three occasions this season, are thought to owe former owner Alexandre Gaydamak £28million and have been served a winding-up petition by HM Revenue and Customs.
Copyright (c) PA Sport 2009, All Rights Reserved.