Mr Shepherd yesterday failed in a High Court attempt to get an injunction against the News of the World to prevent the newspaper publishing further details in its next edition of a conversation he had with an undercover reporter.
Newcastle supporters have been calling for the pair to step down since Sunday when the newspaper published remarks they are alleged to have made insulting the club's star players, mocking the supporters and describing North-eastern women as "dogs".
Yesterday, Gerrard Tyrrell, Mr Hall's solicitor, said his client had no intention of resigning as they had been "stitched up right royally". Mr Hall owns 57 per cent of the club's shares and Mr Shepherd owns 7 per cent.
Alarmingly for the club, the three independent non-executive directors of Newcastle United plc were said yesterday to be considering their positions. It is understood that Sir Terence Harrison, Denis Cassidy and John Mayo will resign in protest if Mr Shepherd and Mr Hall are unable to disprove the allegations by legal action because of worries about the consequences for their own reputations.
Sir Terence, the chairman of Newcastle United plc, the quoted parent company of the football club, is also chairman of the building firm Alfred McAlpine. Mr Cassidy is the former head of Liberty, the London department store and Boddington's brewery. Mr Mayo is finance director of electronics group GEC.
Although Mr Shepherd and Mr Hall take issue with the News of the World's claims, they have not issued a libel writ. Mr Tyrrell said: "If they did say these things, they totally apologise and it was totally out of character ... They don't remember what was said."
He added that a complaint had been made to the newspaper about its reporting methods.
In Newcastle last night, fans were adamant that the two soccer chiefs should go. John Regan, secretary of the Newcastle United Independent Supporters' Association, said: "Their arrogance belies belief - they are refusing to go despite massive public support against them."
The Toon saga, page 18Reuse content