Sisu, the hedge fund owners of Coventry City who moved the proud club to Northampton, have suffered total defeat in a high court judgment damning their “mismanagement” and a “rent-strike” they conducted to imperil the owners of the Ricoh Arena.

In the action, Sisu made allegations that Coventry City Council and its officers behaved improperly when the council refinanced a loan to the arena operating company, ACL, in January 2013. Mr Justice Hickinbottom found that the council behaved properly throughout, but was prompted to buy out the loan partly because, in April 2012, Sisu had withheld rent due at the Ricoh in order to financially “distress” ACL and buy a half share of it “at a knockdown price”.

Sisu had by then “seriously mismanaged” the club, the judge found, having lost around £40m since 2008 – when the hedge fund bought City, then in the Championship and playing at the Ricoh, as a “commercial investment”.

Under previous owners, the club had spent the proceeds of selling its Highfield Road ground, so had also sold its initial 50% share in ACL to the Alan Edward Higgs charity, which had strong local links and a long affinity with Coventry City.

The rent, high at £100,000 a month, and all other arrangements, including that food and drink income went to ACL, were known to Sisu when they took over. They spent three years and huge money on a failed effort to win Premier League promotion before seeking to renegotiate the rent and arrangements, which ACL were prepared to do. However, while negotiating, Sisu withheld the rent to “distress” ACL, which had from the beginning envisaged the club buying back its half share from the charity for a fair price.

By 2012, the judge found: “Sisu had no strategy for maintaining a sustainable football club, except one which involved the purchase, at a knockdown price, of at least a 50% share in ACL and thus the Arena” and the purchase of ACL’s bank loan, also “at a knockdown price”. Trying to secure those aims at the lowest cost, Sisu stopped paying the rent, doing so for the last time in March 2012.

“Sisu distressed the financial position of ACL by refusing to pay ACL any rent or licence fee,” the judge found. “... It had the effect of reducing the value of the share in ACL that Sisu coveted. Sisu’s strategy of distressing ACL’s financial position ... was quite deliberate.”

The 49-page judgment is shot through with references to this “rent-strike”. It says: “CCFC [owned by Sisu], fallen into a parlous state as a result of mismanagement, had unilaterally refused to pay the contractual rent it was legally obliged to pay to ACL.”

In December 2013, the Guardian published an article highlighting the sorry plight of the Sky Blues, whose loyal fans have mostly refused to countenance the vacating of the Ricoh and subsequent groundshare with Northampton, effected by Sisu after it failed to secure the distress and capitulation of ACL. The judge notes that Sisu had previously threatened to leave the Ricoh, or to put the club into liquidation, while it was on rent-strike, to put further pressure on ACL.

In our article we wrote that Sisu “simply stopped paying the rent”. It was not controversial to say so: the club’s withholding of the rent was quite a public act. A month later, after City were relegated to League One, the club’s chief executive, Tim Fisher, confirmed to the Guardian that they had refused to pay the rent again, saying, as he explained elsewhere too, that it was to “focus minds” on the “unsustainable terms” of the arrangement with ACL.

ACL sued in the high court and won the judgment. When the club went into administration, the administrator wrote: “The [club] did not honour its obligations under the terms of the lease and licence.”

However Sisu’s lawyers, Speechly Bircham, complained about the article, and even complained to the Press Complaints Commission, although they did not pursue that complaint after the Guardian showed the high court judgement and administrators’ report to the PCC. In their letter they said it was “inaccurate” and “misleading” to say Sisu had simply stopped paying the rent. The lawyers claimed that ACL and Sisu had “accepted ... that there should be a rental holiday”.

The lawyers also wrote to the Sky Blue Trust, run by volunteer fans committed to a better future for their historic club, threatening them with potential legal action if they did not take down a link to the Guardian article.

Speechly Bircham wrote in their letter to us that “given its natural meaning”, to say Sisu stopped paying the rent “suggests that Sisu was acting in a commercially immoral way”.

Now, a judgment has found categorically they did stop paying the rent. Yet Sisu have not acknowledged that: they have said the judge got it wrong and that they may appeal.

And so they batter on, the dislocated club a blight on the Football League, which unfathomably allowed Coventry City to be moved by a hedge fund seeking to “distress” the operating company of an arena built for the club, owned by the local council and a charity.