Nathan Tinkler's Hunter Sports Group says it will follow through with plans to return the Newcastle Jets A-League licence after compromise talks with Football Federation Australia failed.
HSG announced on Friday it had decided to stand firm on its earlier decision to hand back the licence, despite "lengthy discussions" with FFA over a possible compromise.
The group said it was confident of its legal position and would now "welcome and look forward to any forthcoming legal action."
In a statement released on Friday afternoon, HSG said it had offered a peace deal to FFA which meant it would fulfill the licence agreement it held until 2012.
The terms of the deal included FFA reviewing a reported $4.5 million fee in the acquisition of the club's licence and settling the ongoing Jason Culina insurance matter immediately with the financial liability shared between the Jets, FFA and Culina.
HSG claimed it would also invest $250,000 on behalf of all clubs and the FFA to create an independent taskforce to make recommendations on improving the sustainability and transparency of the A-League.
But HSG claimed the proposals were immediately rejected by FFA chief executive Ben Buckley.
"This inflexible stance highlights the inequitable position and ongoing discrimination in which the Jets have been placed over the past 18 months," the statement read.
"The FFA's mindset of being unwilling to negotiate provides a clear impression that FFA does not want the Newcastle Jets to be part of the football family."
The Jets administration came under fierce criticism for announcing its intention to hand bank its licence on the day of the A-League's annual awards earlier this month.
HSG apologised for making its latest announcement just two days out from the grand final but said FFA's legal team had requested a response by Friday.